On Tuesday July 14, 2026, Governor Hochul signed Executive Order No. 62 pausing the issuance of New York State Department of Environmental Conservation (“DEC”) permits for construction of large data centers. The NY Large Data Center Moratorium Order applies to 50 MW and larger data centers (“Large Data Centers”) which, depending on purpose, typically span a minimum of 150,000 square feet and require at least 50,000 KW of continuous electricity. DEC permit applications for Large Data Centers, including pending applications not yet deemed complete by the agency, cannot be issued until the New York State Department of Public Service (“DPS”) conducts a generic environmental impact review on their potential impacts pursuant to the State Environmental Quality Review Act (“SEQRA”).
This first in the nation statewide moratorium is a significantly scaled back version of an act adopted by New York’s legislature this past session titled the “Responsible Data Center Development Act” (S10642/A11560) (“RDCDA”). Governor Hochul’s Executive Order obviates the need to sign the RDCDA into law and instead directs DPS to complete its interconnection review in Case 26-E-0045 and study the impacts of Large Data Centers through a generic SEQRA review. As detailed in our prior blog post on the RDCDA, New York’s legislature had attempted to define “large” data centers at those 20MW and above and incorporate numerous other requirements on development of 1 MW+ data centers, including prevailing wage and other measures.
The Governor’s Order also accelerates consideration of regulatory mechanisms to ensure Large Data Centers are investing into overall transmission and distribution reliability without impacting other electric ratepayers and the State’s water resources addressed. As part of regulatory proceedings, DPS may adopt funding requirements for Large Data Centers including capital contributions and other measures to avoid the cost of stranded assets if projects do not proceed. DPS may also adopt requirements for clean energy generation on-site and/or dedicated battery storage systems to address potential supply side impacts. DPS must also manage the interconnection process. The DEC must also assess its water withdrawal permit requirements for any large use customers, not just Large Data Centers.
Municipalities that are exercising their Home Rule powers to place moratoria on all types of data centers, as noted in our blog post Data Centers in New York – Local Moratoria are Proliferating, should take the Governor’s lead and focus only on the zoning considerations associated with development of Large Data Centers versus blanket bans on all types of critical digital infrastructure. Indeed, the Governor has directed New York State Empire State Development (“ESD”) to provide municipalities with guidance in creating local community investment frameworks within the next 60 days to achieve the benefits of data center development. Topics for ESD guidance and consideration include how community investment funds might be set up for public infrastructure, prevailing wage preferences incorporated into IDA and other benefits agreements, and ensure that data on key economic benefits be made transparent for host communities.
The Governor’s Executive Order takes a more sensible approach to the issues associated with Large Data Center development by focusing on hyperscaler AI infrastructure and sets a path forward to eventually allow their construction in New York State. The Governor’s Executive Order also avoids the need for legislation like the RDCDA to be signed into law, an action that would have chilled investment in all types of digital infrastructure across New York. While moratoria can be drastic, this one at least sets a path towards actual adoption of regulatory measures that balance the need for Large Data Centers to serve commerce and innovation with localized impacts associated with their development.
The DPS led SEQRA review process for Large Data Centers and other regulatory proceedings at DPS and DEC promise to be fulsome with stakeholder comments from the private sector, environmental community and government. Notably, SEQRA GEIS proceedings can generally be elongated in time and come without specified deadlines for SEQRA findings to be adopted. For Large Data Center development, an open-ended moratorium will certainly pause capital investment in New York, and thus warrant active participation in DPS’s SEQRA proceedings to ensure they move forward purposefully in scope and duration.
