New York just hit the brakes on a major tech industry plan — and it could change what happens across the country.
Governor Kathy Hochul signed an executive order Tuesday making New York the first state in the nation to pause new hyperscale data centers. These massive facilities, which house thousands of computers powering AI and cloud computing, have raised alarms over their enormous appetite for electricity and water. The one-year moratorium will freeze environmental permits while the state figures out how to protect communities, the power grid, and natural resources.
Four hyperscale data centers are already running in New York, and 39 more applications are sitting in the pipeline waiting for approval. That potential flood of new facilities worried environmental groups who say these operations can strain local water supplies and drive up energy bills for everyday New Yorkers.
"This pause will remain in place for up to one year while New York establishes the strongest possible framework to protect our communities, guardrails to reduce the risk to our energy grid, minimize land disruption, noise pollution and protect our natural resources, especially our water supply," Hochul said.
The New York Legislature had already passed a broader moratorium bill in June, though there was uncertainty about whether Hochul would sign it after previously suggesting the decision should be left to local governments. Some advocates say the governor's executive order is a step forward but doesn't go as far as the original legislation.
"The state Legislature's bill is much more protective of the New York state individual, while the governor's proposal seems to be a halfway between the billion-dollar tech industry and her constituents," said Eric Wood, senior environmental program coordinator at the New York Public Interest Research Group.
Kate Boicourt, the Environmental Defense Fund's New York state director, said the order marks a beginning rather than an ending. "There's things that need to be statewide standards," she said. "Otherwise, if you're having specific municipality-by-municipality rules, you are potentially shifting what's allowed in one area and not being allowed in the other."
Not everyone cheered the move. Mark McManus, general president of the United Association, a labor union for plumbers and pipefitters, called the moratorium "shortsighted" and said it would kill good-paying union jobs.
Still, many see New York's decision as a potential turning point. Darrell West, a senior fellow at the Brookings Institution who researches AI and technology policy, noted that about a dozen states have considered similar measures this year. Maine passed a moratorium in April, but its governor vetoed it.
"What happens there often spreads to other areas," West said. "The public opposition to data centers is widespread across the country. It could be lots of states that move in this direction."