New York Gov. Kathy Hochul signed an executive order on Tuesday to pause the issuance of new building permits for hyperscale data centers in the state, the first state-level freeze on new construction of AI data centers.
The moratorium could last up to one year with the expectation that the state will use that time to “build a regulatory framework that protects ratepayers, the environment, the energy grid and communities across the state.”
“As data center development threatens to hike up utility bills, deplete our natural resources and create uncertainty for New Yorkers, it’s my responsibility to take action and lead,” Gov. Hochul said in a press release. “New York will lead the way in creating the strongest standards in the nation for data center development.”
Other states may soon follow suit. Lawmakers in 15 states have proposed temporary or permanent halts to data center construction, although several have failed to gain legislative support. In Maine, the legislature passed a moratorium, but was vetoed by Gov. Janet Mills.
The executive order specifically targets hyperscale data centers, which are used for AI training or inference. While traditional data centers might house hundreds of servers, hyperscale data centers can host tens of thousands of servers and are responsible for disproportionate use of local water and electricity resources.
Hochul is directing the New York Department of Public Service to “consider creating a New York Grid Acceleration Fund to require data centers to invest in the state’s aging grid infrastructure and energy needs” and is pursuing additional legislation to repeal sales tax exemptions for hyperscale data centers in the state.
A representative of Gov. Hochul’s press office didn’t immediately respond to a request for comment.
Existing data centers are unaffected
Hochul’s one-year moratorium applies to new hyperscale data centers, but construction will continue on AI data centers that were previously issued valid permits. There are also exceptions carved out for certain research and educational facilities that use less power, according to Politico.
There are currently 133 data centers operating in New York, with New York City and Buffalo serving as particularly large hotspots for facility construction.
To put that number into perspective, other states like Virginia and Texas have built hundreds more data centers than New York and account for nearly a quarter of the AI data center infrastructure in the US.
Americans broadly reject data center construction
There are already serious concerns about the proliferation of hyperscale data centers across the country.
Reports about Virginia’s data centers claim tens of thousands of on-site fossil-fuel generators could be responsible for tens of millions of dollars in annual health damages. Foreboding images of deep black smog emanating from these data centers recently made headlines during a heat wave that strained the state’s power grid.
These highly publicized scares are just one reason people are protesting the construction of data centers near their homes. A Siena Research Institute poll (PDF) found that most New York state residents supported Hochul’s one-year moratorium.
“Technology should make our lives better, not pollute our water, strain our energy grid, or drive up our utility bills,” New York State Sen. Kristen Gonzalez said in the New York press release. “I have heard from New Yorkers across our state who are concerned about what the rise in large data centers might mean for their communities.”
The New York numbers reflect a broader nationwide reality: Regardless of political affiliation, most people don’t want data centers in their backyard. A recent Gallup poll found that roughly 71% of Americans oppose the construction of data centers in their area. More US residents said they opposed new data centers in their area than opposed new nuclear power plants nearby.
And while many states’ governments have been reluctant to craft legislation banning AI data center construction — or have outright vetoed proposed moratoriums — local communities across the country have mobilized to drive out the server farms.
While the New York executive order is an important win for data center opponents, the odds are still stacked against them. President Donald Trump has thrown his weight behind the AI industry with the intention of removing so-called “cumbersome legislation” to the advancement of the biggest AI companies.
In December, Trump issued an executive order attempting to limit state-by-state regulations and provide a single federal framework for AI companies. The president threatened to withhold broadband funding from states that insist on stricter regulations.
While several deadlines under this executive order have already passed without action by the Trump administration, the threat of federal opposition still looms over state governments considering moratoriums like the one in New York.
Read the full article here