New York Governor Kathy Hochul has announced a statewide moratorium of up to one year on new hyperscale data centers, effective July 14. The pause applies to state environmental permits for new hyperscale data centers and is intended to give the state time to develop a regulatory framework to protect utility ratepayers and address the energy and infrastructure demands associated with these facilities [1].
The decision has drawn criticism from Rep. Mike Lawler, R-N.Y., who argues that the moratorium, along with the state's energy policies—such as banning natural gas and shutting down nuclear power plants—has led to skyrocketing utility rates and is driving businesses out of New York. Lawler stated, "What she is saying is, don't come here. Go do your business elsewhere, which is why New York State leads the nation in out-migration" [1]. He further cited high taxes and a challenging business climate as reasons for companies choosing to expand in other states like Florida, Texas, Tennessee, North Carolina, and South Carolina [1].
According to data from state Comptroller Thomas DiNapoli’s office, New York has experienced net out-migration among part-year resident tax filers every year since 2015. In 2024, 134,913 part-year resident filers left the state while 121,251 moved in, resulting in a net loss of 13,662 filers. However, the pace of out-migration has slowed compared to the surge seen during the pandemic era [1].
Lawler linked the state's business challenges to its energy policies, including nuclear plant closures, restrictions on natural gas and pipeline projects, and electrification requirements. He emphasized the need for a coherent economic and energy policy for New York to prosper in the future [1].
CONCLUSION
The moratorium on new hyperscale data centers in New York has sparked criticism over the state's business and energy policies, with concerns about out-migration and a challenging business climate. While the policy aims to address infrastructure and ratepayer concerns, critics warn it may further deter investment and economic growth.