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New York Becomes First US State to Impose AI Data Center Ban

The pause covers projects needing 50 megawatts or more and gives regulators a year to set new environmental and energy standards.

  • On Tuesday, New York Governor Kathy Hochul signed an executive order establishing a one-year moratorium on new hyperscale data centers requiring 50 megawatts or more of power, halting development until July 2027.
  • Growing public concern over rising utility costs and grid capacity threats prompted the action, as Hochul seeks to prevent AI infrastructure from depleting natural resources and straining local communities.
  • New York currently hosts more than 130 data centers, which the Data Center Coalition noted generated $5.1 billion in state and local taxes in 2024 prior to the moratorium.
  • Digital Realty warned the move could redirect investments outside New York, while Mike Elmendorf, president and CEO of the Associated General Contractors of New York State, called it a "missed opportunity."
  • Lawmakers in more than a dozen states are considering similar restrictions, though New York remains the first to enact a full moratorium on construction while finalizing new environmental standards.
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Reuters broke the news in London, United Kingdom on Tuesday, July 14, 2026.
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