Hochul Tightens Leash on Data Center Developers
Two months after enacting a one-year moratorium on the construction of large data centers, New York Gov. Kathy Hochul is again flexing her power over the controversial sector.
Hochul instituted transparency, safety and reporting requirements for the industry, the Commercial Observer reported. The rules are set to take effect at the beginning of the next year, coinciding with the full enactment of the Responsible AI Safety and Education (RAISE) Act.
Developers and operators in the sector must send quarterly reports to the new Office of Digital Innovation, Governance, Integrity and Trust, detailing potential catastrophic risks. They will also need to send disclosures to the state government every two years and report safety incidents at their sites to DIGIT within 72 hours.
“When companies are building some of the most powerful technology in the world, people deserve to know what they’re doing to keep it safe, and those companies should be held accountable when things go wrong,” Hochul said in a statement.
In mid-July, Hochul ordered a moratorium on large data centers to allow the state to develop an environmental assessment and set consistent standards while establishing rules for how they can provide their own energy.
The one-year suspension applies to data centers exceeding 50 megawatts that hadn’t received permits to start construction. The executive didn’t apply to hospitals, research centers and schools.
Hochul also directed the Department of Public Service to weigh the creation of a fund to require data center developers to invest in the state’s power grid and mitigate the increased demand. The governor ordered the department this year to set rules requiring data centers to either produce their own power or transport it to the site.
She also said she’d pursue legislation next year to strip data centers across the state of sales tax exemptions.
New York is far from the only place in the country that is grappling with data center development.
This week, Los Angeles County placed a temporary ban on AI data center developments in unincorporated areas while working on permanent prohibitions. The restriction follows similar bans and moratoriums in San Gabriel Valley municipalities like Monterey Park, El Monte and Baldwin Park.
Residents and local officials cite public health, environmental concerns and potential impacts on utility infrastructure as primary reasons for pushback.
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