New York becomes first state to have moratorium on banning AI data centers
New York has enacted a one-year moratorium on data center construction over 20 megawatts, ordered by Governor Kathy Hochul, to develop new regulations and protect communities. The state aims to address energy grid strain, land disruption, noise pollution, and natural resource protection, while also considering requiring developers to contribute to grid upgrades and ending sales tax breaks.
New York has become the first state to implement a moratorium on data center development. Governor Kathy Hochul issued an order on Tuesday, pausing construction of data centers over 20 megawatts for up to one year, until 2027. This pause is intended to allow state officials more time to develop new regulations aimed at protecting communities and ensuring they benefit as the demand for data centers, driven by artificial intelligence, continues to grow.
The Governor stated that the state seeks to establish the strongest possible framework to protect communities, reduce risks to the energy grid, minimize land disruption and noise pollution, and safeguard natural resources. Additionally, she will consider requiring developers to help fund energy grid upgrades and pursue legislation to eliminate sales tax breaks for large data centers.
The National Conference of State Legislators reports that at least seven other states are considering similar bans. Georgia has already introduced legislation for a potential ban until December 2028. In Florida, while no statewide moratorium is in place, Clay and Nassau counties have enacted one-year moratoriums, and Commissioner Ann Taylor is leading efforts to pass a pause in St. Johns County.