Gov. Kathy Hochul announced Tuesday that New York will halt the approval of environmental permits for new large-scale data centers for up to one year, temporarily blocking major projects while the state develops stricter regulations for the rapidly expanding industry.

Under an executive order Hochul said she will sign, state regulators will impose a temporary moratorium on issuing new air permits for so-called hyperscale data centers seeking to connect to New York’s electrical grid. The pause is expected to remain in effect for as long as one year.

Explaining the decision, Hochul said, “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.”

She added, “New York will lead the way in creating the strongest standards in the nation for data center development, ensuring that when companies succeed because of New York, New Yorkers succeed too.”

Demand for massive data centers has surged in recent years, driven largely by the explosive growth of artificial intelligence and other computing-intensive technologies. Those facilities consume enormous amounts of electricity, raising concerns about their impact on power supplies and utility costs.

Public opinion appears to favor the temporary pause. A Siena University poll conducted last month found that approximately half of New York voters believe a one-year moratorium on large data centers would benefit the state. Twenty-one percent opposed the proposal, while another 17% said they were undecided.

The temporary freeze applies only to new permit applications and is expected to remain in place while state officials study the industry’s impact and develop a new regulatory framework governing future data center construction.

Hochul said the restrictions will not be permanent. “Once the State finalizes these standards, the moratorium will be lifted, allowing new data center projects to proceed as long as they follow state, zoning code and other local approvals.”

The governor’s executive action is less sweeping than legislation approved earlier this year by the New York State Legislature. That proposal would have imposed additional requirements on data center operators, including paying union-scale prevailing wages and obtaining a significant portion of their electricity from renewable energy sources.

Business organizations strongly opposed the legislative proposal, arguing that the additional mandates would discourage investment and economic development in New York.

{Matzav.com}