New York State Legislature Passes First-in-the-Nation Data Center Moratorium

On June 4, 2026, both houses of the New York State Legislature passed the Responsible Data Center Development Act (S10642/A11560) (the Act), which would impose a one-year moratorium on the issuance of certain permits for large data centers. The bill cleared the Senate by a vote of 44-16 and the Assembly by 102-39 in the final hours of the 2026 legislative session. If signed by Gov. Kathy Hochul, New York would become the first state in the nation to enact a statewide data center moratorium.

The Act adds a new Article 31 to the Environmental Conservation Law and amends the Public Service Law, Public Authorities Law, Energy Law, and Labor Law. It defines a “data center” as a facility (or combination of commonly owned or controlled facilities at the same site) with a peak demand of one megawatt (MW) or more used for computing infrastructure, data processing, web hosting, streaming support, or related services, as defined by the New York State Public Service Commission (NYSPSC). A “large data center” is defined as a data center with a peak demand of 20 MW or more.

The centerpiece of the legislation is a one-year moratorium, measured from the Act’s effective date (the date the Governor signs it into law), barring the New York State Department of Environmental Conservation (NYSDEC) from issuing any permit, certificate, registration, license, or other form of approval to a large data center. The moratorium does not reach the modification, renewal, reissuance, or recertification of previously issued approvals, nor does it apply to large data centers that commence construction on or before the effective date.

Beyond the pause, the Act directs several New York State agencies to undertake various actions. For example, NYSDEC, in consultation with the New York State Department of Public Service, the New York State Department of Health, the Environmental Facilities Corporation, and the New York State Independent System Operator, Inc. (NYISO), must prepare a statewide environmental impact report on data center development, to be finalized no later than 18 months after the Act becomes law. The subjects the report must address include the average and peak electric load of data centers, electricity consumption and generation sourcing, the volume of discounted or subsidized electricity used by data centers, water consumption and discharge, land use, greenhouse gas and other pollution, electronic waste, and the public funds and tax incentives received by data centers. In parallel, the NYSPSC, by 2030, must require utilities to file for a separate rate classification for large data centers, and the New York State Energy Research and Development Authority (NYSERDA) must develop energy-consumption efficiency goals for new and existing data centers.

What the Act Would Require of Data Center Developers

For developers, the Act layers new obligations onto the existing permitting process. Before NYSDEC may issue any permit or approval for a large data center, the applicant must hold at least one in-person public hearing in a host community no less than three months before the approval is issued. The developer must provide residents at least 30 days’ advance notice of the hearing, including a summary of the project and its specific location, a detailed explanation of projected energy use and energy system impacts, a detailed explanation of projected water use and wastewater impacts, and a detailed accounting of the state and local economic incentives the project is seeking or has already been awarded.

Additional obligations extend beyond the permitting stage. Every data center with a peak load of five MW or more must procure at least one-third of its electricity from renewable sources by 2030, two-thirds by 2035, and 90 percent by 2040, and must derive as much of its energy as is feasible from on-site renewable generation. New and existing data centers will also be subject to energy-efficiency goals to be developed by NYSERDA. In addition, each new large data center, and any existing large data center undergoing a major expansion adding 20 MW or more of load, must fund a host-community benefits program covering residential energy upgrades, community infrastructure, and measures to mitigate water and wastewater impacts. Finally, construction of covered data centers must satisfy prevailing-wage and apprenticeship requirements and use iron and steel produced or made in the United States.

Gov. Hochul has not stated a position on the bill. Her office has indicated the governor will review the legislation.

A Surge in Large Loads and Parallel Regulatory Activity

The NYISO has reported its large-load interconnection queue grew from six projects totaling roughly 1,045 MW in 2022 to 48 proposals totaling approximately 12 GW as of December 31, 2025. In addition to the Legislature’s passage of the Act, this growth in large load interconnection requests has driven regulatory activity at both the NYSPSC and the NYISO. At its February 12, 2026 session, the NYSPSC instituted a proceeding in Case 26-E-0045 to advance “Energize NY Development,” an initiative aimed at reforming how large electric loads interconnect to the grid while protecting ratepayers. Central to that effort is a goal that customers who impose costs on the system should bear those costs rather than shift them to other ratepayers. Separately, the NYISO has been weighing revisions to its large-load interconnection study process to address bulk-system reliability concerns and improve the predictability of project timelines.

Harris Beach Murtha’s Energy Industry Team regularly assists data center developers in navigating New York State’s siting and interconnection processes, and we can assist developers understand and comply with any new requirements that may arise from this legislation should it be signed into law. We continue to monitor developments and to stay current on the full range of legislative and regulatory developments affecting data center developers across New York State.