AGC NYS: Data center moratorium a 'missed opportunity' for construction industry
New York has enacted a moratorium on new hyperscale data centers via executive order, becoming the first state to do so. Governor Kathy Hochul cited concerns about outpaced grid capacity and rising costs for ratepayers. Industry groups and critics, including the Associated General Contractors of New York State, argue the moratorium is a missed opportunity for the state's construction industry and economic development.
New York Governor Kathy Hochul has signed an executive order placing a moratorium on new hyperscale data centers, making New York the first state to implement such a measure. Governor Hochul stated that the action aims to create the strongest standards for data center development, addressing concerns that these facilities consume vast amounts of power, potentially overwhelming the state's grid and increasing costs for residents. She emphasized her refusal to let these costs be passed on to New Yorkers.
The decision has drawn mixed reactions from various stakeholders. Mike Elmendorf, president and CEO of the Associated General Contractors of New York State, called the moratorium a 'missed opportunity,' highlighting the potential role data center development could play in revitalizing the state's construction industry, which is still recovering from the COVID-19 pandemic. Elmendorf also warned that fast-moving data center projects would likely seek opportunities in other states rather than wait out New York's year-long moratorium.
Conversely, the Data Center Coalition, an industry advocacy group, countered that data centers generate high-wage jobs, contribute billions to the GDP, and provide significant tax revenue for state and local services. State Sen. Kristen Gonzalez, who sponsored the Responsible Data Center Development Act, emphasized bipartisan support for the moratorium across New York, citing concerns from communities statewide.