New York Gov. Kathy Hochul announced plans on Tuesday to impose what she described as the nation's first statewide moratorium on new "hyperscale" AI data centers.
"Massive data centers are being built across our state and our country," Hochul said in a video posted to X. "The scale and speed of this development has put unprecedented demand on energy and water resources and threatens to drive up utility costs."
The Democratic governor added, "Before it goes any further, I need safeguards in place to protect New Yorkers. That's why I'm signing the country's first moratorium on new hyperscale AI data centers, giving us the time to establish the nation's strongest protections for ratepayers, our communities, and our energy grid."
Shares of data center companies including Digital Realty Trust, Vertiv Holdings, and Equinix dipped on the news, falling as much as 2% early Tuesday.
AI data centers are reshaping our future.
No one gets to build that future by asking New Yorkers to sacrifice theirs.
Today, I’m taking action. pic.twitter.com/rNZCfdn1el
Hochul said New York wants AI companies to invest and grow in the state, but not at the cost of its communities and infrastructure.
"When you benefit from the talent and energy of New York, we expect you to protect our resources and give back to our communities," Hochul said. "This is a critical moment, and New York is going to take the time to get it right."
Hochul is expected to sign an executive order on the matter Tuesday.
Hochul's announcement comes as tech giants race to build massive data centers across the US to power AI technologies such as large language models.
The rapid buildout of these data centers has become a flashpoint nationwide, with critics sounding the alarm over energy demand, water consumption, and the strain on local infrastructure.
Read next
Natalie is a senior reporter on Business Insider's Business News team.She was previously on BI's Legal Affairs team where she covered major cases out of state and federal court, as well as bankruptcy. Her coverage often focused on stories at the intersection of law, business, politics and technology. Natalie has covered Donald Trump’s criminal and civil cases, the wave of lawsuits against the second Trump administration, the indictment and criminal trial of Sean “Diddy” Combs, the shooting death of UnitedHealthcare CEO Brian Thompson, and the legal battles facing Elon Musk and his companies. Natalie came to Business Insider in June 2021 as a breaking news reporter, focusing on the most interesting angles around the trending news of the day. Natalie largely drove BI’s coverage around the fatal “Rust” shooting involving Alec Baldwin and the disappearance and murder of Gabby Petito.Prior to joining BI, Natalie worked for the New York Post, the New York Daily News, and The Brooklyn Paper. She has an extensive background covering crime and courts. During her more than 12-year journalism career, she did a stint covering the police beat out of the headquarters for the New York Police Department. Natalie, a Brooklyn native, graduated from Brooklyn College in 2012 with a journalism degree. Popular articles
- Walmart and Amazon face legal trouble for using a points system to track and fire employees over absences: lawyers
- Celebrities who partied with Diddy may want to contact their lawyers
- An unchecked AI could usher in a new dark age
- At Diddy's A-list 'white parties,' naked women were a staple — but that didn't seem to raise eyebrows at the time
- The illegal maneuvers the rich use to get richer
- Owner of ship that crashed into Baltimore bridge will likely try to invoke 1851 law used to cap damages after Titanic disaster
Follow Following
Every time publishes a story, you’ll get an alert straight to your inbox!
Look out for an alert in your inbox the next time publishes a story!
Every time a new story is published, you’ll get an alert straight to your inbox!
Look out for an alert in your inbox the next time a new story is published!
By clicking “Sign up”, you agree to receive emails from Business Insider. In addition, you accept Insider’s Terms of Service and Privacy Policy.
