The New York data centre moratorium signed by Governor Kathy Hochul makes the state the first in the country to formally halt construction of large facilities, with an executive order pausing state environmental permits for projects of 50 megawatts and above. Call it a landmark moment in tech governance, or call it what it also plainly is: a state government deciding the AI infrastructure boom has been handed too many blank cheques for too long.
What the New York Data Centre Moratorium Actually Does
Hochul signed Executive Order No. 62, which pauses discretionary permitting by the New York State Department of Environmental Conservation (DEC) for data centres at or above the 50-megawatt threshold. According to a Phillips Lytle legal analysis, the order also directs the Department of Public Service (DPS) to develop a Generic Environmental Impact Statement (GEIS) to assess the environmental effects of data centre construction and operation statewide.
The DPS has additionally been directed to convene New York’s transmission owners, who must review their practices for studying grid system impacts of data centres and report back within 90 days. That is a fairly tight deadline for an industry that has spent years getting grid interconnections approved on its own schedule.
The moratorium is expected to last up to one year. Hochul’s office framed the pause as the foundation for what it described as ‘a nation-leading regulatory framework that protects ratepayers, the environment, the energy grid and communities across the state.’ Whether that framework arrives in a year, or quietly takes longer, will be the real test.
The executive order followed passage of the Responsible Data Center Development Act in the state legislature last month, according to the Phillips Lytle analysis, suggesting Hochul and lawmakers had been coordinating rather than working at cross-purposes. The legislature has also advanced a separate bill that would pause construction of data centres larger than 20 megawatts for one year, and a further bill still in committee proposes a three-year moratorium. The executive order lands somewhere in the middle, in both scope and duration.
Grid Pressure, Public Scepticism, and the AI Demand Curve
The timing is not accidental. Data centres now being planned are dramatically larger than those built even a few years ago. The average facility constructed recently has come in below 100 megawatts, but projects in development are pushing well beyond that. BloombergNEF projects that nearly a quarter of new data centres built through 2030 will exceed 500 megawatts, driven by AI computing demands.
New York’s electrical grid is already feeling the strain. Two-thirds of respondents to a recent poll said they were concerned about data centres driving up electricity prices, and public sentiment has shifted markedly. Another survey found people would sooner have an Amazon warehouse next door than a data centre.
Hochul put it plainly at a press conference in Brooklyn: ‘Progress shouldn’t arrive with a higher utility bill, deleted water supply, or noise pollution. These data centers can only be built, should only be built in places that want them. So they will never be exempt from local zoning, local approvals.’
The broader public mood on AI investment is consistent with that framing. A Pew Research Centre survey from April 2025 found that only 10% of the general U.S. public said they were more excited than concerned about AI in daily life, against 47% of AI experts who said the same. Just 23% of the public felt the technology would have a positive impact on how people do their jobs, and less than a quarter believed AI would give the economy a boost.
A follow-up Pew survey from September 2025 found that half of U.S. adults say the increased use of AI makes them feel more concerned than excited, and 53% believe AI will worsen people’s ability to think creatively. Only 16% thought it would improve that capacity. Politicians reading those numbers are not exactly facing pressure to protect the data centre industry.
There is a federal wrinkle here too. Last month, the Federal Energy Regulatory Commission (FERC), led by a Trump appointee, told grid operators to develop fast-track interconnection lanes specifically for data centres. That sits in some tension with what New York is doing. FERC had also separately issued an order to show cause requiring the New York Independent System Operator and transmission owners to review and justify their interconnection practices for large loads, according to the Phillips Lytle analysis.
New York’s moratorium is the first to actually take effect. Vermont Senator Bernie Sanders proposed a nationwide version, but it gained little traction. Maine’s legislature passed a bill that would have paused construction until November 2027, but Governor Janet Mills vetoed it. More than 230 organisations called for a nationwide pause in December. New York has moved from debate to done.
Hochul is also weighing whether to require data centres to pay into a fund supporting the state’s electrical grid, and she has expressed a desire to strip hyperscale facilities of tax benefits. That combination, as local coverage has noted, suggests the moratorium is less a pause and more an opening position in a longer negotiation. Watch the GEIS process: the standards it sets will determine what, if anything, gets built in New York after the year is up. And with public trust in AI governance still thin, the political incentive to go easy on data centres is not obviously there.
