New York Gov. Kathy Hochul signed an executive order on July 14 that pauses state environmental permits for new hyperscale data centers for up to one year while officials develop environmental standards, ratepayer protections, and a community investment framework.
The moratorium applies to proposed or expanded data centers capable of consuming at least 50 megawatts whose discretionary state permit applications had not been deemed complete before the order took effect. Local permits and approvals are not covered by the pause.
Facilities primarily used for manufacturing, medical care, education, or research are exempt. The exemption covers certain university research facilities, the Empire AI consortium, and facilities used for quantum computing or biomedical research.
“New York has always been at the forefront of innovation and change but we’ve also always guaranteed that New Yorkers benefit. As data center development threatens to hike up utility bills, deplete our natural resources, and create uncertainty for New Yorkers, it’s my responsibility to take action and lead,” Hochul said.
Nearly 12 gigawatts of proposed data center demand were in the New York Independent System Operator’s interconnection queue as of May, including more than 8 gigawatts added in 2025, according to the executive order. The projects are being driven by demand for artificial intelligence (AI), cloud computing, streaming, and other data-intensive services.
The order directs the state Department of Public Service to prepare a Generic Environmental Impact Statement examining data centers’ effects on energy demand, water use and quality, air quality, noise levels, and disadvantaged communities. The process must include an opportunity for public comment and a public hearing.
The department will also create a New York Grid Acceleration Fund that could require data center operators to make upfront contributions for grid improvements, clean energy generation, battery storage, demand-response programs, and protections against costs from projects that are delayed, reduced, or canceled.
The Department of Public Service must also form a Data Center Interconnection Working Group within 60 days and report within 90 days on how transmission owners evaluate data centers and other large electric loads.
The Department of Environmental Conservation must separately report within 12 months on whether the state needs new water-use regulations, reporting requirements, or guidance for large customers such as data centers.
Hochul’s order also directs Empire State Development to publish a Community Investment Framework within 60 days to help local governments negotiate benefits from data center developers.
The moratorium will end after the Department of Public Service submits its final environmental review and findings, which the governor’s office said could take up to one year. The Department of Environmental Conservation will hold affected permit applications while the review is underway.
The executive order follows the legislature’s passage in June of the Responsible Data Center Development Act, which would impose a one-year permitting pause while the state studies the environmental and community effects of data center development.
That legislation would also require separate utility rate classifications for data centers, increasing renewable energy requirements, benefits for host communities, and protections for local water resources.
“In the weeks since the Assembly and Senate both passed the Responsible Data Center Development Act at the end of the legislative session, New Yorkers across the state have spoken up in support of a data center moratorium,” Assemblymember Didi Barrett said. “Governor Hochul’s executive order, including a year-long moratorium, is a timely and important first step in addressing these concerns.”
The bill still awaits Hochul’s signature.
