Scrub the data center ban!
Desperate tech and business groups begged Gov. Kathy Hochul to pull the plug on a measure that will block new artificial intelligence data centers from coming online in New York for one year.
Albany Democrats were poised Thursday to ram through the ban as they wrapped up their work for the year – drawing an outcry from groups such as the Business Council of New York that contended it’d stymie economic growth.
“The rush to enact this measure left critical issues unanswered, creating uncertainty for businesses, consumers, and energy stakeholders alike,” Business Council spokesperson Patrick Bailey wrote in a statement to The Post.
“We intend to engage directly with the Administration to address these concerns and advocate for reasonable changes through chapter amendments or a veto,” he added.
The spread of AI data centers has sparked a backlash from a spectrum of groups concerned about them straining local communities’ energy supply, driving up already sky-high electric utility rates, increasing pollution and Big Tech’s growing power.
But the business groups urging Hochul to reject the ban argue the Empire State needs to stay competitive as artificial intelligence becomes increasingly important.
“A blanket moratorium on data centers would slow investment in the next generation of infrastructure projects our economy increasingly depends on, and we urge Governor Hochul to veto this bill,” said Julie Samuels, president and CEO of Tech:NYC, a coalition of New York technology sector firms.
“Energy usage, grid capacity, and the community impact of data centers must be addressed, and the Governor’s Public Service Commission is already pursuing the right approach by ensuring data centers pay their fair share for grid upgrades and energy usage.”
The bill would place a one-year moratorium on permitting for new data centers of more than 5 megawatts.
State Senate Majority Leader Andrea Stewart-Cousins (D-Westchester) confirmed her chamber would pass the bill Thursday, following suit with the state Assembly, which passed it earlier in the day.
“We believe that we can get this right and we believe that we should just put a pause on the application process and look at it,” Stewart-Cousins said.
“We don’t think data centers are going away, but we do think we can have a say,” she added.
After the one-year moratorium is up, stiff requirements would remain in place such as an expensive prevailing wage requirement that’d force construction of new centers toward using union labor.
Larger facilities demanding more than 20 megawatts of energy usage would face even more roadblocks – such as a ban on utility and water companies subsidizing a data center’s hookup and a requirement that they most mostly use renewable energy by 2040.
“If we’re saying to them they can’t use natural gas, they’re not going to come here, period,” said Assemblyman Phil Palmesano (R-Schuyler) as he railed against the measure on the Assembly floor Thursday.
He pointed out that data centers are being singled out, where other major tech and economic developments such the Micron chip manufacturing facility outside Onondaga County that New York enticed to the state with lavish incentives.
“If we told Micron they had to power their energy demands strictly using renewable resources, they wouldn’t be here,” Palesano added, emphasizing his view that the legislation is more than just a one-year pause.
Hochul has thrown cold water on statewide restrictions recently, saying permitting should be up to localities.
A spokesperson for her office gave The Post her boilerplate response for newly passed bills saying she will “review” the legislation.
The ban is far from the first time New York lawmakers have sided with greeny activists over an emerging sector.
In 2022, Hochul signed a moratorium on cryptocurrency mining operations, laying out many of the same concerns about water and energy usage being posed in the current debate.
And former Gov. Andrew Cuomo was quick to sign an executive order implementing a moratorium on natural gas fracking that would later be solidified in state law.
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