New York pauses permits for large data centers for up to a year

New York became the first US state to halt construction of new large-scale data centers on Tuesday, after Governor Kathy Hochul signed an executive order pausing permits for up to one year. The moratorium takes effect immediately and applies to facilities with capacities of at least 50 megawatts, which the source describes as enough electricity to power tens of thousands of homes. The state said the pause will give it time to develop regulation for a rapidly expanding sector driven by demand for artificial intelligence. Critics of data centers cite high electricity use, pressure on local grids, higher energy bills, heavy water use, noise and a relatively small number of jobs. Hochul said New York supports innovation but must ensure residents benefit. She said data center development threatened to raise utility bills, deplete natural resources and create uncertainty, and said the state would seek what she called the strongest data center development standards in the country. Hochul also said she would pursue legislation to repeal sales tax exemptions for massive data centers in New York. The state legislature passed its own moratorium bill in June with a lower 20-megawatt threshold, but Hochul has not signed it. Her office said the bill needed more work. The report said dozens of US cities and counties have adopted local limits on data centers, but New York's order is the first statewide pause. Tech companies and other data center supporters argue that blocking construction harms local job growth and weakens the United States against China in the race to dominate AI. US data center construction spending has risen sharply in recent years, with technology companies spending tens of billions of dollars on infrastructure. A similar moratorium passed in Maine in April but was vetoed by Democratic Governor Janet Mills, who said it would have blocked a proposed data center in a town affected by a local mill closure. A June study by Allianz Trade estimated data centers emitted 286 million tonnes of carbon dioxide in 2025. The report said AI already accounts for between 15 and 20 percent of data center electricity use and that the share could rise to 40 percent by 2030.