New York Gov. Kathy Hochul has imposed a one-year moratorium on construction of large data centers, citing electricity costs, natural-resource consumption and uncertainty for communities. It is the first such action by a state.
In an executive order, Hochul said New York will stop issuing environmental permits for a year while the state creates regulations that “protects ratepayers, the environment, the energy grid and communities across the state.”
Hochul also said she would seek to repeal state sales-tax exemptions for large data centers.
The moratorium applies to facilities expected to consume at least 50 megawatts of power, according to The Hill.
President Trump blasted the move. “New York should change its Policy, IMMEDIATELY,” he said on Truth Social. “All of this Income, and other Benefits, will be going to Red States, and some Blue, where Data Centers are sought as Cash Cows, with Lower Taxes and Record Setting Jobs. They must pay for their own Water and Power, and any leftover goes back to the State and local Community. Data Centers are tremendous WINS for the States and Communities that are lucky enough to get them.”
The move is an important escalation in the political backlash against AI infrastructure. Data-center development has expanded rapidly as technology companies seek electricity, land and cooling capacity for training and inference.
Until recently, debate centered largely on zoning approvals and utility negotiations. New York’s action moves the issue into statewide economic policy and could encourage lawmakers elsewhere to consider similar restrictions.