New York Bans New Data Centers for One Year

New York has become the first state to implement a one-year moratorium on new data centers exceeding 50 megawatts (MW) in size. Governor Kathy Hochul announced the executive order, citing concerns over rising utility bills, depletion of natural resources, and uncertainty for residents. The state government aims to develop regulations addressing these challenges during the moratorium period. Hochul also expressed a desire to repeal existing tax exemptions for large data centers.

This action by New York reflects a broader trend across the United States, where states and cities are increasingly enacting various measures to control data center development. These measures include ratepayer protection laws, zoning restrictions, moratoriums, and permanent bans. In Arizona, a new law mandates that data center grid costs will not be passed on to other customers, and regulators are establishing rules to enforce this. The state also implemented a three-year pause on sales tax exemption applications for data centers, while Tucson is developing new zoning regulations for large facilities.

California has seen cities like Monterey Park, in the L.A. area, enact permanent bans on new data center construction, although no statewide moratorium is currently under consideration. Florida's new state law requires data centers to bear their full cost of service, preventing utilities from shifting these costs to other customers. Sarasota County has also imposed a moratorium on new large data centers. In Georgia, despite a failed statewide moratorium, 11 counties have implemented their own construction moratoriums.

Other states are also taking action. Illinois is considering a state bill that would require data centers to cover their own costs, promote clean energy usage, and limit water consumption, while two counties and two municipalities have existing moratoriums. Iowa has seen five counties enact moratoriums on data center construction. These widespread regulatory actions highlight growing concerns about the environmental and economic impacts of the rapidly expanding data center industry.