Local Groups Split on Data Center Moratorium
New York Governor Kathy Hochul signed an executive order enacting a one-year statewide moratorium on hyperscale data center construction and operation. This pause will allow the state to develop consistent environmental standards and a Community Investment Framework, addressing concerns about utility costs, environmental impact, and community benefits. Local groups hold divided opinions on the moratorium's potential effects on innovation and local economic benefits.
New York Governor Kathy Hochul has signed an executive order imposing a one-year statewide moratorium on the construction and operation of hyperscale data centers. Announced during a press conference in Brooklyn, the governor cited potential burdens on taxpayers and concerns regarding the state's water and air quality, as well as strain on the electrical grid, as primary reasons for the ban.
The moratorium will allow state agencies to develop comprehensive guidelines. Hochul has directed the Department of Public Service (DPS) to develop a Generic Environmental Impact Statement (GEIS) for data centers to standardize environmental assessments. Concurrently, the Department of Environmental Conservation (DEC) will not issue new discretionary permits during this period. Additionally, Empire State Development (ESD) is tasked with creating a Community Investment Framework (CIF) to guide local entities in negotiating community benefits such as infrastructure improvements, child care, and direct financial support. DPS will also explore establishing a New York Grid Acceleration Fund for data center investments in grid infrastructure and clean energy, and the governor is pursuing legislation to repeal sales tax exemptions for large data centers.
Local reactions to the moratorium are divided. Stacey Sikes, interim president and CEO of the Long Island Association, expressed concern that the ban sends the wrong signal, potentially deterring innovation and investment in AI and advanced infrastructure, pushing high-quality jobs to other states. In contrast, Eric Alexander, executive director of Vision Long Island, supports the moratorium, emphasizing the need to thoroughly analyze the impacts and benefits of data center proposals for local communities. The Town of Brookhaven is also considering its own 18-month local moratorium.