New York has become the first US state to impose a one-year moratorium on new hyperscale data centres after Governor Kathy Hochul signed an executive order pausing state environmental permits. The moratorium, announced this week, will last until regulators develop a new framework to assess the impact of large data centres on electricity demand, water resources, and local communities, according to medianama.com.
The executive order requires the Department of Public Service (DPS) to prepare a Generic Environmental Impact Statement (GEIS) examining the environmental effects of hyperscale data centres, including electricity and water use, air quality, noise, and impacts on disadvantaged communities. Meanwhile, the Department of Environmental Conservation (DEC) must hold discretionary permits for new or expanded data centres in abeyance unless applications were already deemed complete before the order. Empire State Development is tasked with publishing a Community Investment Framework within 60 days to guide local authorities in negotiations.
Governor Hochul emphasized the need to balance innovation with protecting New Yorkers, citing concerns that data centre development could increase utility bills, deplete natural resources, and create uncertainty for residents. This move marks a significant regulatory step in the US data centre sector, which has seen rapid growth amid rising demand for cloud services and AI computing. New York’s approach contrasts with other states that have encouraged data centre expansion without such environmental reviews.
The moratorium will remain in effect until the DPS completes the environmental impact review and the new regulatory framework is established. The executive order and related documents are publicly available, setting a precedent for other states considering similar measures on hyperscale data centre development.