Criticized for excessive energy and water consumption, there’s a growing movement in the U.S. today to curb the proliferation of data centers. Federal lawmakers proposed a temporary moratorium on data center construction last March, as reported by AN.
New York Governor Kathy Hochul this week signed an executive order (EO) that sets the country’s first moratorium on new hyperscale data centers.
Hyperscale data centers consume more than 50 megawatts (MW) of power, and typically exceed 10,000 square feet and have more than 5,000 servers. They support the cloud software of Amazon, Google, Microsoft, and other corporations.
Per the International Energy Agency, conventional data centers are around 10-25 MW in size. The Responsible Data Center Development Act was sponsored by State Senator Kristen Gonzalez.
New York will cease issuing environmental permits for hyperscale data centers for one year, a temporary moratorium enacted by the EO.
More time is needed to build a regulatory framework that protects ratepayers, the environment, energy grid, and communities, the Governor’s Office said.
The push for more robust data center regulatory frameworks stem from past initiatives taken by the Governor’s Office to safeguard the public from the effects of artificial intelligence (AI).
The moratorium could impact architecture firms active in the data center construction sector. Today Corgan is the highest earning architecture firm in the data center industry. HDR, Woolpert, Gensler, Stantec, AECOM, HKS, Page, HED, Arcadis North America, and DGA have also earned substantial data center facility revenue.
“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,” Governor Hochul said in a statement.
“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,” Governor Hochul continued.
Data center projects that have already received permits will not be impacted by the EO. Construction industry leaders and AI lobbyists expressed opposition to the EO.
Brian Sampson, president of the Empire State Chapter of Associated Builders and Contractors told Construction Dive, “This moratorium is another missed opportunity for New York. Data centers create high-quality construction jobs, strengthen our economy, and attract the kind of long-term private investment every state should be competing for.”
Caleb Max, National AI Association CEO, told Politico the industry needs to respond to mounting public distrust of AI.
“I wouldn’t call it panic, but the concern is real and it moved fast,” said Joseph Hoefer, principal and chief AI officer of Monumental Advocacy, a lobbying firm. “The real worry in the industry isn’t New York specifically, it is the precedent.”