New York has become the first state to enact a law prohibiting the blocking of data

New hyperscale data centers won’t be able to set up shop in New York for a year now that Governor Kathy Hochul (D) has signed the first statewide ban. But a bill passed by the state legislature that could ban most of the events awaits his signature.

The law prohibits new permits for data centers larger than 50 megawatts, which the governor’s office says will give the state time to introduce regulations needed to protect people from rising electricity prices and environmental pollution. This is higher than the 20 megawatt limit approved by state legislators. Hochul’s office could not immediately determine how many concepts would be affected by the plan, but said the limit should prevent disruptions to small data centers used by institutions like hospitals. Hochul has not yet said whether he will sign the ban passed by the legislature, but his actions allow him to put a temporary stop to the bill.

“As data center development threatens to raise utility bills, destroy our natural resources, and make New Yorkers uncertain, it is my responsibility to act and lead,” Hochul said in a statement. The suspension may last for a year while the Department of Human Services (DPS) comes up with standards to assess the environmental impact of the construction and operation of the data center, including water use and air quality. Hochul is also asking DPS to consider creating a data center to invest in the district, and calling on the state’s development agency to find ways to help local communities discuss the benefits when a data center tries to come to town.

Maine nearly became the first state to pass a pre-existing data center the governor vetoed the bill in April. People across the country have been grappling with an increase in infrastructure they fear will affect energy prices and the environment as AI accelerates its demand. State funding for data center development has been one of the main motivators, and Hochul said Tuesday he wants to push the Legislature to restore business taxes to the state’s largest data centers when it returns next year.