From Harlem to the Hudson, New York is poised to become the largest state in the nation to consider a sweeping moratorium on data center construction.
This after Democratic legislators introduced a bill this week that would halt new large-scale projects for three years.
State Senator Liz Krueger, chair of the Senate Finance Committee, and Assemblymember Anna Kelles introduced the legislation (S.9144) on Thursday, citing concerns about energy costs, environmental impacts, and the strain data centers place on the state’s electric grid.
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“Hit the Pause Button”
The bill would freeze state and local approvals for data centers exceeding 20 megawatts for three years while regulators assess the industry’s cumulative effects. During the moratorium, the Department of Environmental Conservation would be required to complete a comprehensive environmental impact statement examining the industry’s effects on energy use, electricity rates, water resources, air quality, and greenhouse gas emissions.
“Massive data centers are gunning for New York, and right now we are completely unprepared,” Krueger said in a statement. “It’s time to hit the pause button, give ourselves some breathing room to adopt strong policies on data centers, and avoid getting caught in a bubble that will burst and leave New York utility customers footing a huge bill.”
The Public Service Commission would also be required to report on cost impacts to ratepayers and issue orders ensuring those costs are borne by data center developers rather than ordinary consumers.
Growing Nationwide Movement
The legislation places New York at the forefront of a bipartisan wave of data center skepticism spreading across the country. Similar moratorium proposals have been introduced in Maryland, Georgia, Oklahoma, Virginia, and Vermont in recent weeks. In Michigan, at least 19 communities have passed or proposed local moratoriums on data center development.
The bill follows Senator Bernie Sanders’s call in December for a national moratorium on AI data center construction, making him the first federal legislator to propose such a measure.
Environmental groups have championed the legislation. “This strongest-in-the-nation moratorium bill is logical, it’s timely, and it will deliver the results we need,” said Eric Weltman, senior New York organizer at Food & Water Watch.
Industry and Labor Opposition Expected
Labor unions are expected to oppose the measure. Daniel Ortega, executive director of New Yorkers for Affordable Energy and head of community affairs for Engineers Labor-Employer Cooperative, said his group would fight the proposal. “These are really good projects for our members overall,” Ortega said.
The bill comes weeks after Governor Kathy Hochul announced plans to require data centers to pay more for electricity through her “Energize NY Development” initiative, unveiled during her State of the State address in January. Hochul’s proposal would require projects creating high energy demand without corresponding job creation to “bear the costs they incur – either through fees or by generating their own power.”
Assemblymember Kelles, who previously championed New York’s 2022 moratorium on gas-powered cryptocurrency mining operations, called the current moment an opportunity to establish protective regulations. “Data centers are expanding rapidly across the country and in New York, often with significant demands on our electric grid, water resources, and waste systems,” she said.
Photo credit: WIki.
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