Mass. sets new data center restrictions

Massachusetts Governor Maura Healey signed an executive order imposing new restrictions on data center development across the state. The order mandates that energy-intensive data centers must secure approval from local elected boards before they can apply for a state permit. Additionally, developers will be required to either provide their own "clean" energy or contribute to a new "ratepayer protection fund" to protect consumers from potential utility rate increases.

Governor Healey emphasized that these measures place communities "in the driver's seat" and provide clarity for data center development, addressing concerns related to rising utility bills and the strain on the regional electric grid. These new regulations will apply only to proposed or new data centers, not the approximately 50 existing facilities, most of which are concentrated in the greater Boston area. This action follows a previous directive from Healey in June to temporarily suspend new tax exemption applications for data center operations until stronger protections could be implemented.

The article highlights Massachusetts's challenge, mirroring that of many other states, in balancing the energy demands of the artificial intelligence industry with controlling electricity costs and preserving power grid stability. It also references similar legislative efforts in states like Georgia, Maryland, Vermont, and Virginia to propose data center moratoriums, and an executive order by New York Governor Kathy Hochul enacting a one-year moratorium on large data centers. Furthermore, U.S. Rep. Lori Trahan is leading a bipartisan federal initiative for industry guardrails, while former President Donald Trump signed an executive order to limit states' regulatory authority over AI, pledging to penalize non-compliant states.