Gov. Kathy Hochul signed an executive order on Tuesday that paused certain state environmental permit applications for New York’s largest new or expanding data centers while her administration develops new rules for the rapidly growing industry.
The pause applies to new or expanded data centers capable of using at least 50 megawatts of electricity if their applications for discretionary Department of Environmental Conservation (DEC) permits had not been declared complete before Hochul signed the order on July 14.
Applications that DEC had already deemed complete are not subject to the pause. The order also does not affect zoning decisions or other permits issued by local governments.
The pause will remain in effect until the state completes an environmental review examining data centers’ effects on electricity demand, water resources, air quality, noise and disadvantaged communities. Hochul said the process is expected to take up to one year, although the order does not set a firm expiration date.
Hochul’s administration described the action as the nation’s first statewide moratorium on new hyperscale data centers.
“These hyperscale AI data centers consume enormous amounts of power, truly threatening to outpace our grid’s capacity, and they drive up costs for local ratepayers,” Hochul said during an announcement in Brooklyn.
The order covers qualifying server facilities capable of using at least 50 megawatts, while excluding facilities primarily used for manufacturing, medical care, education or specified research.
Asked why her administration selected 50 megawatts as the cutoff, Hochul said it wanted to avoid affecting smaller facilities serving hospitals, schools, research institutions and banks’ back-office operations.
“We want to make sure we didn’t touch the data centers that are powering hospitals and schools and research centers,” Hochul told reporters after the announcement.
Hochul said the administration surveyed the industry before settling on the threshold. She compared a 50-megawatt facility’s electricity demand to the amount needed to power 50,000 homes.
“Above 50, which requires the power equivalent of powering 50,000 homes, is a real drain on our environment, our energy supply and ultimately our water,” she said.
The executive order says that, as of May, nearly 12,000 megawatts of proposed data center demand was in the New York Independent System Operator’s interconnection queue, including more than 8,000 megawatts added during 2025 alone.
The queue includes requests from projects seeking to connect to the state’s bulk electricity system. The executive order notes that data center development can be unpredictable and that expected electricity demand does not always fully materialize, potentially leaving utilities and ratepayers exposed to infrastructure costs.
The surge is part of a nationwide expansion. The United States had more than 3,000 operating data centers and more than 1,500 others under construction, planned or land-banked as of Feb. 19, according to a Pew Research Center analysis of Data Center Map. New York had 148 operating data centers, the fifth-highest total in the country.
NYISO, which operates the state’s bulk power grid, warned in its 2026 Power Trends report that electricity demand is rising and becoming more difficult to predict as data centers and other energy-intensive developments place additional pressure on the system.
The report said New York’s reliability margins are tightening as older power plants retire or age and new supplies are not added quickly enough with the same operating capabilities.
Large-load proposals, which also include semiconductor manufacturing and other industrial projects, represent several thousand megawatts of possible new demand over the next decade, NYISO said.
Many data centers may have limited ability to reduce their power use during periods of grid stress. Without coordination between new demand, infrastructure upgrades and additional power supplies, the system could become more reliant on expensive resources and emergency measures, placing upward pressure on electricity costs statewide, according to the report.
Hochul’s order follows the Legislature’s passage of the Responsible Data Center Development Act, sponsored by state Sen. Kristen Gonzalez and Assemblymember Didi Barrett.
That legislation would impose a one-year moratorium beginning at 20 megawatts, potentially covering smaller projects excluded from Hochul’s executive order.
The bill would prohibit DEC from issuing permits, certificates, licenses and other approvals to covered facilities for one year. Its moratorium would not apply to modifications or renewals of previously issued approvals or to data centers that began construction before the law took effect.
The bill would also require host-community hearings and disclosures about energy demand, water use and public incentives.
It would also establish separate utility rate classes for large data centers, require them to cover related infrastructure costs and impose renewable-energy, community-benefit and labor standards.
Hochul has not committed to signing the legislation.
Asked whether lawmakers had been wrong to select a 20-megawatt threshold, Hochul said the bill’s sponsors supported her executive action but that her administration was still reviewing the measure.
“As all of you know who ask me when I’m going to sign a bill, we go through a very arduous process of reading every word, examining the implications, and what is doable,” Hochul said. “I want to make sure that we get ahead of this right now, which is why we took the steps we did.”
Asked whether signing the legislation could result in changes to the executive order, Hochul said she would “let the process play out” and continue discussions with lawmakers.
Gonzalez joined Hochul at the announcement and praised the executive action, describing it as similar to her legislation while acknowledging its higher threshold.
“If big tech is coming onto our turf, it should be on our terms, which means no more new data centers unless we have the right processes in place,” Gonzalez said.
Gonzalez said proposed data centers in New York are seeking more than 9,000 megawatts of new electricity, an amount she compared with roughly one-third of the state’s annual energy use.
State Sen. Kristen Gonzalez, sponsor of the Responsible Data Center Development Act, speaks at Gov. Kathy Hochul’s data center moratorium announcement in Brooklyn on July 14Photo by Susan Watts/Office of Governor Kathy Hochul
Under the executive order, the Department of Public Service will prepare a generic environmental impact statement studying the potential effects of data center construction and operation.
The permit pause will continue until DPS submits a report on the final environmental impact statement and its findings. Hochul said the moratorium would be reviewed and lifted once the new policy framework is in place.
The 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 framework would offer guidance on community investments, infrastructure, labor standards, local hiring and workforce development.
Local governments and industrial development agencies may use the framework when negotiating with developers, but the order does not itself require developers to make a set community-benefits payment.
Hochul said data centers should be built only in communities that want them and that the projects would remain subject to local zoning and approval requirements.
The order also directs DEC to assess whether the state needs new regulations, policies or reporting requirements to ensure its water-withdrawal program accurately reflects the demands of large water users, including data centers. DEC must issue a report on that review within 12 months.
Hochul also directed the Department of Public Service to consider a grid fund requiring data centers to help pay for infrastructure and new energy supplies.
Regulators will also consider requiring developers to finance dedicated clean generation or battery storage. Those measures were not imposed by the executive order.
Hochul also said she would pursue legislation repealing sales tax exemptions for massive data centers, a change that would require approval from the Legislature.
The governor framed the moratorium as a temporary pause rather than a retreat from New York’s investment in artificial intelligence.
“We don’t believe there’s a conflict between the innovation economy and our desire to just pause and make sure, as we lean into the future of how we power AI, that we do it right,” Hochul said.