Continuing Coverage: New York becomes first state to limit data center permits
New York Governor Kathy Hochul has signed a one-year statewide moratorium on large data center permits, making New York the first state to implement such a pause to establish environmental and energy grid standards. This action impacts proposed projects like Guild Ventures' data center in Albany and has prompted several local communities, including the Town of Bethlehem and East Greenbush, to consider or enact their own moratoriums due to concerns about energy and water usage.
New York Governor Kathy Hochul signed an executive order, enacting a one-year statewide moratorium on permitting for hyperscale data centers in New York that would use 50 megawatts of power or more. This makes New York the first state in the nation to implement such a pause, with the goal of establishing rules and standards to protect the environment and energy grid. Data centers will be required to produce their own energy or pay a premium to tap into the state's power capacity. The Governor also proposed ending tax subsidies for data centers.
The decision has garnered mixed reactions. Justin Wilcox, Executive Director of Upstate United, expressed concern that the moratorium could deter investors, noting New York already has high energy prices without a large number of data centers. While some state lawmakers like Assembly Speaker Carl Heastie and Assemblyman Phil Steck support the general idea of regulating data centers, Heastie hoped the Governor would sign a separate bill passed by the legislature for a similar moratorium. Senator Kirsten Gillibrand praised the order, stating New Yorkers deserve a say in how technology impacts their communities, but U.S. Senators John Fetterman (D-PA) and Ted Cruz (R-TX) criticized the move, with Cruz calling New York's policies hostile to energy and business.
The moratorium directly impacts potential projects like Guild Ventures' proposed multibillion-dollar mixed-use technology campus in Albany, anchored by a data center at the former Kenwood Commons property. This project, which could require up to 100MW for the data center, has not yet been formally submitted to the city. Albany city officials view the pause as an opportunity to study impacts on water infrastructure and utility bills.
Local communities across the Capital Region are also addressing data center development. The Town of Bethlehem recently enacted its own one-year moratorium, citing concerns about noise, electricity, and water consumption, with Supervisor David Van Leuven noting that one data center could use as much water as the entire town. The town of East Greenbush is also considering a six-month moratorium, scheduled for a vote.