New York Legislature Passes One-Year Moratorium on Large Data Centres

The New York State legislature has passed a one-year moratorium on the construction of new large data centres, a legislative move that would establish the first statewide ban of its kind in the United States if enacted. The bill is now pending the signature of Governor Kathy Hochul, who has until December to decide whether to sign the legislation into law or veto it. Lawmakers behind the measure state that the pause is necessary to allow policymakers sufficient time to assess the environmental impact and energy consumption associated with these facilities.

Under the terms of the legislation, large data centres are defined as projects with a peak electricity demand of at least 20 megawatts. The bill directs the state’s environmental agency to produce a comprehensive impact report assessing the electricity, water, and land usage of these facilities, as well as the pollution they generate. Additionally, companies planning to build such centres must fund and hold a public hearing at least three months prior to gaining project approval. This one-year pause is shorter than the three-year proposal previously introduced, according to Politico.

The legislative action comes as the New York Independent System Operator, a nonpartisan entity responsible for maintaining electric grid reliability, reviews 24 data centre proposals totalling over 9,000 megawatts. Specific projects have already drawn scrutiny, including a proposed 180-megawatt facility in Albany that has raised concerns among residents. Surveys indicate that most Americans oppose the placement of data centres in their communities, a sentiment reflected in heated public meetings across the country that have become a galvanising issue across the political spectrum.

The moratorium has faced opposition from industry groups, who argue it could harm the state’s economy. Stacey Sikes, acting president and CEO of the Long Island Association, stated that the blanket ban would be damaging because it prevents a case-by-case evaluation of projects that could be beneficial. Sikes told Politico that the moratorium would not allow the state to move forward on data centre projects that would actually help the economy.

This development follows a similar legislative attempt in Maine earlier this year, where the legislature passed a bill to ban new data centres until late 2027. However, Democratic Governor Janet Mills vetoed that legislation due to a lack of exemption for a previously planned project. While Hochul’s office did not immediately respond to requests for comment following the passage of the New York bill, spokesperson Kathy Devoe previously stated that the Governor would review the legislation.