Gov. Kathy Hochul signed an executive order Tuesday establishing the nation’s first statewide moratorium on new hyperscale data centers, pausing state environmental permits for up to a year as officials develop regulatory standards addressing the facilities’ effect on the power grid, water resources and electricity bills.
The order directs the state’s Department of Environmental Conservation to hold any incomplete permit applications for new or expanded data centers capable of consuming 50 megawatts of power or more, the threshold state officials used to define a hyperscale facility. Applications deemed complete before Tuesday are not affected, and the order does not apply to local permits or approvals, which remain the responsibility of individual municipalities. The International Energy Agency defines conventional data centers as typically using between 10 and 25 megawatts, while hyperscale, AI-focused facilities can draw 100 megawatts or more.
“These hyperscale AI data centers consume enormous amounts of power, truly threatening to outpace our grid’s capacity, and they drive up costs for local ratepayers,” Hochul said. “I refuse to let those costs be passed on to New Yorkers who already pay too much for their utility bills.” In a separate statement, Hochul said the state intended to “lead the way in creating the strongest standards in the nation for data center development.”
New York’s average residential electricity price has climbed nearly 68% since 2019, according to the governor’s office, and the state has the fourth-highest average energy costs in the country. An analysis by the Empire Center, a New York-based public policy think tank, found residents paid 56% above the national average price per kilowatt-hour as of April.
The moratorium follows separate legislation passed by the New York state legislature that would have imposed a similar one-year pause on hyperscale permits, defined in that bill as facilities with a peak load above 20 megawatts. Hochul’s office had not indicated whether she would sign that measure, with aides saying it required further review; the executive order allowed the administration to act immediately rather than wait on the legislative process.
As part of the same effort, Hochul directed the state’s Department of Public Service to develop a Generic Environmental Impact Statement establishing consistent standards for future data center approvals, building on the Energize NY proceeding the governor launched earlier this year requiring data centers to pay more for their energy usage or supply their own power.
Laura Shindell, director of New York State’s Food & Water Watch, an environmental advocacy group that has pushed for tighter data center regulation, welcomed the announcement. “This one-year moratorium is a huge step forward for New York communities fighting against an onslaught of massive data center proposals,” Shindell said.
New York has not historically been a major destination for the largest hyperscale data centers, and the state has faced organized opposition to proposed projects in communities including Lansing and East Fishkill. Technology industry groups have argued that blocking data center construction threatens local job growth and could cede ground to China in AI development. More than a dozen other states have proposed similar moratoriums, though none had enacted one before New York’s order. Maine’s governor vetoed a comparable measure earlier this year, citing its effect on a proposed data center project in a town affected by a mill closure.
