BILL NUMBER: S9144
SPONSOR: KRUEGER
 
TITLE OF BILL:
An act to amend the environmental conservation law, in relation to
imposing a moratorium on data center permit issuance; and to amend the
public service law, in relation to data center rate impacts
 
PURPOSE OR GENERAL IDEA OF BILL:
This bill imposes a moratorium lasting a minimum of three years and
ninety days on the issuance of permits for new data centers. During the
moratorium, the bill requires the Department of Environmental Conserva-
tion to issue a generic environmental impact statement on data centers,
as well as any new or amended regulations it deems necessary to minimize
those impacts. It also requires the Public Service Commission to issue a
report on rate impacts of data centers, and any new orders it deems
necessary to ensure those impacts are not borne by other residential,
commercial, or industrial ratepayers.
 
SUMMARY OF SPECIFIC PROVISIONS:
Section 1: Legislative Findings
Section 2: Amends the Environmental Conservation Law by creating a new
Article 31.
31-0101: Definitions
31-0103: Imposes a moratorium on the issuance of new permits for the
siting, construction, or commencement of operation of a data center.
The moratorium j will expire ninety days after the Department of Envi-
ronmental Conservation and the Public Service Commission have completed
all actions required by the bill.
31-0105: Requires the Department of Environmental Conservation to issue
a final generic environmental impact statement on data centers no sooner
than 18 months after the bill becomes law.
31-0107: Requires the Department of Environmental Conservation to issue
any new or updated regulations necessary to mitigate the environmental
impact of data centers no sooner than three years after the bill becomes
law.
Section 3: Amends the Public Service Law by adding a new section 66-x.
Requires the Public Service Commission to issue a report on the impact
of data centers on electric and gas rates for residential, commercial,
and industrial users, no later than 18 months after the bill becomes
law. Also requires the Commission, no sooner than three years after the
bill becomes law, to issue any additional orders necessary to minimize
the impact of new data centers on electricity and gas rates for residen-
tial, commercial, and industrial users, and to ensure that all costs
associated with providing and maintaining electric and gas service to
new data centers shall be borne by the data center.
Section 5: Effective date.
 
JUSTIFICATION:
The rapid growth of data centers around the country, including in New
York State, is driving up electricity rates, putting a strain on the
electric grid, increasing fossil fuel consumption, and making it more
difficult to achieve clean energy targets.
A Bloomberg analysis of wholesale electricity prices found that 70% of
locations with year-on-year price increases were within 50 miles of
significant data center activity. Nationally, household electricity
rates increased 13% in 2025, largely driven by the development of data
centers.
The projected tripling of data centers across the nation in the next
five years would result in data centers consuming more electricity than
28 million households. Data center electricity usage in New York has
been projected to increase by more than 9,000 MW, which is approximately
double the electricity use of all New York households combined.
Data centers disproportionately use fossil fuels rather than renewable
energy, with 56% of the electricity used to power data centers coming
from fossil fuels, with the result that data centers have an average
carbon footprint that is 48% higher than the US grid as a whole. Even
when data centers use renewable energy, they often capture new renewable
generation development that would otherwise have allowed for the closure
or reduced reliance on fossil fuel power plants, thereby resulting in
continued use of fossil fuel-based energy generation beyond current
expectations.
A tripling of data centers nationwide would require the equivalent water
usage of 18.5 million households just for cooling the servers. Data
centers convert agricultural and other non-industrial land to industrial
usage, removing farmland, woodland, and other resources while driving up
land values and property taxes. The computing hardware used to run arti-
ficial intelligence (AI), including microchips and processing, memory,
and storage components has a lifespan of 2-5 years and is regularly
replaced with updated versions. As a result, the current AI boom will be
responsible for generating up to 5 million tons of e-waste annually by
2030.
This bill would address these issues by pausing the creation of new data
centers in New York for 3 years, during which time the Department of
Environmental Conservation and the Public Service Commission would be
required to issue reports and regulations to minimize the impact of data
centers on the environment and energy costs. Pausing new data centers
will allow New York State to avoid the worst impacts of the current AI
bubble and the intense development pressure around new data centers,
including the massive costs of building out the associated energy
infrastructure. It will also give the Legislature and Executive agencies
time to select and implement appropriate policies to address the nega-
tive impacts of data center development.
 
PRIOR LEGISLATIVE HISTORY:
This is a new bill.
 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
None.
 
EFFECTIVE DATE:
This bill is effective immediately.