Governor Kathy Hochul signed an executive order on July 14 imposing a one-year moratorium on new hyperscale data centers across New York, the first statewide freeze of its kind in the country. The order pauses state environmental permits for proposed facilities drawing 50 megawatts or more of electricity while regulators build a permanent framework.
Hochul cited fears that data center growth is driving up utility bills, straining the power grid, and depleting local water and energy resources. Within 60 days, the state will issue guidance letting local governments negotiate community-benefit deals with developers, covering things like infrastructure upgrades, child care investment, or direct payments. Hochul is also pushing legislation to repeal sales-tax exemptions for large data centers.
The Data Center Coalition, an industry group, warned the pause could push hundreds of billions of dollars in investment and jobs to other states, costing New York tens of millions in stranded tax revenue. The move lands as AI infrastructure buildouts nationwide face growing pushback over electricity and water demand.