New York has become the first US state to impose a statewide moratorium on construction of large data centers, pausing new approvals for one year while officials develop environmental standards for facilities that support the AI boom.
Governor Kathy Hochul announced the action through an executive order that immediately suspends permits for new data center projects requiring 50 megawatts or more of electricity if they have not yet received final approval. Existing projects that already hold the necessary permits are not affected.
The temporary freeze will remain in place while state agencies prepare a Generic Environmental Impact Statement intended to establish uniform requirements for future developments.
In announcing the moratorium, Hochul said the state must respond to concerns that large data centers could drive up utility costs and consume natural resources. Alongside the construction pause, she said the administration will pursue legislation eliminating sales tax exemptions currently available to large data center developments.
The environmental review will examine how future facilities affect electricity demand, air quality and water resources before the state resumes permitting. According to the governor’s office, the moratorium will end once those standards are completed.
According to New York’s independent grid operator, more than 12 gigawatts of large energy-intensive projects, including data centers, were waiting to connect to the state’s electric grid as of May. One gigawatt can supply electricity to roughly 750,000 homes.
Although New York has attracted less hyperscale development than states such as Virginia and Texas because of higher land prices and tighter power availability, interest has continued to grow. The state currently has more than 130 data centers, compared with more than 600 in Virginia and roughly 500 in Texas. New York also ranks among the states with the nation’s highest residential electricity prices.
Growing Resistance
New York’s moratorium is part of a growing national backlash against the rapid expansion of AI infrastructure. Even as tech companies invest billions of dollars in hyperscale data centers, communities and state governments are scrutinizing the facilities’ impact on power grids and water supplies.
A recent Gallup poll found that 71% of Americans oppose construction of AI data centers in their communities, and 48% said they are strongly opposed. Similar concerns have prompted lawmakers in numerous states to introduce legislation addressing data center energy use, environmental impacts and electricity costs.
New York’s executive order follows several other attempts to slow development. Maine’s legislature approved a statewide moratorium earlier this year, but Governor Janet Mills vetoed the measure. Seattle also recently adopted a temporary pause on new data center projects. New York is the first state to successfully implement a statewide moratorium.
The Trump administration has encouraged faster deployment of AI infrastructure through its AI Action Plan, while state officials are confronting the practical consequences of supplying enough electricity, water and land to support the next-gen hyperscale facilities. New York’s approach demonstrates that energy and environmental oversight is becoming a larger consideration as AI infrastructure expands across the US.
