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The Data Center Divide

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New York

This restriction takes precedence while in effect. The rating below excludes temporary restrictions.

Pro-Data Center Policies

New York exempts qualifying data centers from sales taxes on certain equipment and services, subject to security and web-hosting conditions. An enacted order is also described as pausing some state environmental permits for new or expanded centers pending review, while excluding local permits and existing operations.

Incentives

Tax benefits

Qualifying Internet data center operators receive state and local sales and use tax exemptions for eligible equipment and related services.

current law · Statewide
Exempts qualifying purchases from New York sales and compensating use tax, including computer hardware used predominantly for software development or website design under § 1115(a)(35), and machinery, equipment, and other tangible personal property used by qualifying New York internet data centers under § 1115(a)(37).New York Tax Law § 1115(a)(35), (37) — Internet Data Center Sales and Use Tax Exemption

What this means

The measure offers a meaningful financial benefit by exempting qualifying data centers from sales and use taxes on important equipment and related services, including servers, cooling, and power equipment (covered property). The benefit is limited to centers that meet specific security and web-hosting requirements, and centers primarily selling internet access are excluded (eligibility limits), so it is substantial for eligible projects but not broadly available to all data centers.

People behind it

  • Administers the Internet data center sales-tax exemptions by issuing Form ST-121.5 and related guidance.

Restrictions & requirementsHide restrictions & requirements9
  • To qualify for the Internet data center exemption, the facility must be specifically designed and constructed as a high-security environment for servers and similar equipment that host Internet websites.

  • The operator must provide uninterrupted access to customers’ webpages 24 hours a day, 7 days a week, 365 days a year, and continuously manage Internet traffic for those webpages.

  • An operator does not qualify if more than 50% of the use of the otherwise qualifying data-center property is devoted to selling the operator’s own Internet access service.

  • Property qualifies for the exemption only if it is located or installed in the New York data center, required for, and directly related to providing Internet website services for sale.

  • Exempt services are limited to installing, maintaining, servicing, or repairing qualifying property, maintaining or repairing qualifying real property, and protective or detective services provided directly to or in relation to exempt data-center property.

  • When services cover both exempt and taxable property, the exempt portion must be allocated using a reasonable method and separately stated on the invoice; otherwise, the entire invoice may be taxable.

  • Contractors, subcontractors, and repairers may purchase qualifying property tax-free only when it will become part of a capital improvement at the Internet data center.

  • Operators must provide the seller with a properly completed Form ST-121.5 exemption certificate. The certificate must generally be delivered no later than 90 days after delivery of the property or service, and sellers must retain it for at least three years after the applicable return due date or filing date, whichever is later.

  • A blanket exemption certificate must be reviewed when the exempt percentage for services changes; a new certificate is required for subsequent purchases when the percentage changes.

Benefits & exceptionsHide benefits & exceptions6
  • Sales and use tax exemption for qualifying machinery, equipment, software, and other tangible personal property purchased by an Internet data center operator. The property must be placed or installed at a New York data center and be required for and directly related to providing Internet website services for sale. Covered items include servers, routers, software, storage equipment, fiber-optic and copper cabling, cooling equipment, fire-suppression systems, generators, power conditioners, security equipment, and raised flooring. qualifying property

  • Sales and use tax exemption for services performed directly on or in relation to qualifying data-center property, including installation, maintenance, servicing, and repair of tangible personal property; maintenance, servicing, and repair of qualifying real property; and protective or detective services. services rendered directly to or in relation to the property

  • Contractors, subcontractors, and repairers may purchase qualifying data-center property or related services tax-free in specified circumstances. Property purchases qualify only when the property will become part of a capital improvement to the data center’s real property; qualifying installation, maintenance, servicing, and repair services may also be purchased exempt. contractors may purchase qualifying tangible personal property

  • The exemption extends to only the reasonably allocable portion of services provided to property that is partly exempt and partly taxable. Acceptable allocation methods include square footage, time, or property values, and the exempt amount must be separately stated on the invoice. an allocation may be used

  • Data-center operators can document exempt purchases using Form ST-121.5, including as a blanket certificate for subsequent purchases of the same general type of property or service. A certificate must contain the required information and generally must be provided to the seller within 90 days after delivery. Form ST-121.5

  • Eligibility is available to facilities specifically designed and constructed as high-security environments for servers hosting Internet websites, provided the operator supplies uninterrupted access to customers’ webpages and continuously manages Internet traffic. The exemption does not apply if more than 50% of the relevant property’s use is for the operator’s own retail Internet access service. high security environment

Sources

current law · Statewide
Establishes a temporary statewide moratorium on covered data-center development while New York develops higher standards and a framework for community benefits, addressing concerns about energy and water use, environmental and public-health effects, disadvantaged communities, and utility and ratepayer risks.New York Executive Order No. 62 (2026)

What this means

The measure would pause certain state environmental permits for data center construction or expansion until a statewide review is finished, which could significantly delay projects. It does not stop existing centers from operating, and local permits are excluded; the measure also offers no immediate benefits that offset the delay.

Timing

Ends
Until DPS submits its report of the final Generic Environmental Impact Statement and associated findings statement

The moratorium covers specified discretionary state permits before DEC, not local-government permissions. Development of the environmental review is expected to take up to one year. No extension condition is stated, and the expiration of other provisions is not specified.

People behind it

  • Issued and signed Executive Order 62, establishing the moratorium.

  • Directed to prepare the environmental review and carry out related grid and interconnection work.

  • Responsible for pausing certain discretionary permits and assessing data-center water-withdrawal requirements.

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  • Directed to develop and publish the Community Investment Framework for localities.

  • Proposed interconnection reforms, instituted the related proceeding, and served as lead agency for the environmental review.

Restrictions & requirementsHide restrictions & requirements1
  • Until DPS submits its final Generic Environmental Impact Statement and findings statement, DEC must hold in abeyance applications for discretionary DEC permissions to construct or expand covered data centers if the applications were pending or later submitted and had not been determined complete before the order. The moratorium may last up to one year; it does not cover local-government permissions or applications already deemed complete. Covered facilities generally consume or can consume at least 50 MW, with exceptions for facilities primarily used for manufacturing, research, education, or medical care.

Benefits & exceptionsHide benefits & exceptions6
  • DEC’s temporary hold does not cover applications it determined complete before the order’s date, so those applications may continue through the process. determined to be complete

  • The moratorium provision does not apply to local-government permits or approvals, so those remain outside that hold. does not apply to permits

  • Facilities primarily used for manufacturing, research, education, or medical care are excluded from the order’s definition of a data center and are not subject to it. Some educational facilities must meet specified conditions, including academic research at eligible New York colleges and universities. is not covered by this definition

  • DPS must form a working group to address interconnection issues and support efficient interconnection for large new customers, including data centers. It must also consider “beneficiary pays” principles for network-upgrade and resource-adequacy costs. support efficient interconnection

  • DPS is directed to consider a Grid Acceleration Fund to finance grid improvements and clean-energy supply, potentially including generation or battery storage dedicated to data-center operations. This is a possibility for DPS to assess, not a guaranteed benefit, and data centers may be required to contribute. dedicated to their operations

  • The moratorium ends once the state finalizes its new standards; projects may then proceed if they meet those standards and applicable zoning and other local approval requirements. The moratorium will be lifted

Sources

pending · Statewide
Would regulate data-center development and its environmental, utility, community, and labor impacts, but remains a proposed measure rather than binding law; the bill was passed by both houses and returned to the Assembly without being shown as signed by the governor (legislative actions and bill text).New York A11560 (2025-2026)

What this means

The bill would pause permits for large data centers for one year, with limited exceptions, making new construction and expansion much harder during that time. It would also add ongoing costs and requirements for utilities, clean energy, community benefits, public hearings, and construction wages.

Timing

Ends
one year after the effective date of this section

The moratorium applies to permits and other approvals for large data centers. It does not apply to modifications, renewals, reissuances, or recertifications of previously issued approvals, or to large data centers already under construction when the section takes effect. Other provisions remain; no extension condition is stated.

People behind it

  • Bill sponsor and introducing body; introduced the bill at the request of Barrett, Kelles, Tapia, and Glick.

  • Named in the sponsor listing and requested the bill’s introduction.

  • Co-sponsor and requester of the bill’s introduction.

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  • Co-sponsor and requester of the bill’s introduction.

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  • Responsible for preparing the environmental impact report and administering permit and hearing requirements.

  • Responsible for utility classifications and adjustment mechanisms, and for establishing the host-community benefits program.

  • Coordinates on public hearings and has responsibilities related to implementation.

  • Consults on the environmental impact report.

  • Consults on the environmental impact report and host-community benefits program.

  • Consults on the environmental impact report and coordinates on energy-cost adjustments and efficiency goals.

  • Consults on the environmental impact report and host-community benefits program.

  • Consults on the environmental impact report.

  • Consults on the host-community benefits program.

  • Works with other entities to determine data-center energy-efficiency goals.

  • Required to establish a host-community benefits program for large data centers in its service territory.

  • Works with other named entities to determine and annually update data-center energy-efficiency goals.

  • Required to establish separate service classifications for large data centers and allocate related costs to those classifications.

  • Defined as the fiscal officer responsible for enforcing construction labor standards, except for specified New York City projects.

  • Serves as fiscal officer for qualifying projects performed under permits issued by a city with a population over one million.

  • Sponsor of the Senate bill.

  • Co-sponsor of the Senate bill.

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  • Co-sponsor of the Senate bill.

  • Co-sponsor of the Senate bill.

Restrictions & requirementsHide restrictions & requirements10
  • For one year after the section takes effect, the Department of Environmental Conservation may not issue a permit or other approval to a large data center, defined as one with peak demand of at least 20 MW. Exceptions cover modifications, renewals, reissuances, or recertifications of existing approvals and centers that began construction by the effective date. A press summary describes a three-year moratorium, but the detailed bill text specifies one year.

  • Before receiving Department of Environmental Conservation approval, a large data center must hold an in-person hearing in at least one host community at least three months beforehand, give residents at least 30 days’ notice with specified project information, and pay hearing expenses, including agency costs.

  • Large data centers must be placed in separate electric, gas, and water service classifications. These classifications assign the facilities specified service, infrastructure, administrative, operating, and related costs, including attributable commodity-price increases, to the data centers rather than other customers. The Public Service Commission generally may not approve rate or tariff changes without the required classifications and cost-adjustment mechanism; implementation is due by June 1, 2030.

  • Regulations may require financial surety for utility or water service to large data centers, such as insurance, a guarantee, a surety bond, a letter of credit, or qualification as a self-insurer.

  • Operators must meet energy-consumption efficiency goals, which may include waste-heat recycling goals and are reviewed annually. Operators already operating when the provision takes effect have two years to comply; those starting within the following year have one year to comply.

  • Data centers with peak loads of at least 5 MW must annually obtain independent verification of renewable-energy procurement: at least one-third of electricity use in 2030–2034, two-thirds in 2035–2039, and 90% from 2040 onward. They must also annually demonstrate that they obtain as much of their energy needs as is technologically, environmentally, and practically feasible from on-site renewable generation.

  • Each new large data center, and an existing large data center expansion adding at least 20 MW of load, must fund a host-community program for eligible residential technologies, community infrastructure, and measures to prevent specified water and wastewater harms. The program includes community engagement and independently audited annual financial reports.

  • As part of the host-community benefits process, a data center must hold at least one hearing in a host community, provide an opportunity for public comment, and pay the hearing expenses, including agency costs.

  • Construction of a data center with peak demand of at least 5 MW, including an expansion that brings it to that threshold, is subject to prevailing-wage requirements, except for qualifying projects under pre-hire collective-bargaining agreements. Owners or developers must also require apprenticeship agreements or workforce training where no apprenticeship program exists, and covered iron and steel must meet specified U.S.-production requirements.

  • Community-infrastructure projects funded under the host-community benefits provision with construction costs of at least $1 million are subject to prevailing-wage requirements, subject to listed exceptions including qualifying collective-bargaining agreements and specified residential projects.

Benefits & exceptionsHide benefits & exceptions7
  • Data centers with peak demand below 20 megawatts are not classified as large data centers and are outside the one-year permit moratorium, which applies to large data centers.

  • Facilities majority-owned, operated, or controlled by a public research institution and used for research are excluded from the bill’s definition of a data center, so the data-center provisions do not apply to them.

  • The one-year moratorium does not bar modifications, renewals, reissuances, or recertifications of previously issued approvals, or large data centers that began construction by the section’s effective date.

  • For construction of a data center with peak demand of at least 5 megawatts, prevailing-wage requirements do not apply when the work is performed under a qualifying pre-hire collective bargaining agreement.

  • In industries without apprenticeship programs, an owner or developer may require workforce training instead of apprenticeship agreements; training is preferably done with a bona fide labor organization.

  • Operators have two years to meet energy-efficiency goals if their centers are already operating when the provision takes effect, and one year if their centers begin operating within the following year.

  • For data centers with peak loads of at least 5 megawatts, renewable-energy procurement requirements phase in: at least one-third of electricity for 2030–2034, two-thirds for 2035–2039, and 90% from 2040 onward.

Sources

pending · Statewide
Would pause new permits for covered data centers while New York evaluates environmental, infrastructure, community, and utility-rate impacts; the proposed bill applies to facilities capable of using at least 20 megawatts of electricity (bill text).New York S9144A (2025-2026)

What this means

If enacted, the bill would block new permits for data centers able to use at least 20 megawatts until 90 days after state environmental rules and utility actions are completed; those rules cannot be issued sooner than three years after the law takes effect, and the bill sets no maximum waiting period. It exempts renewals and changes to existing permits, but would make new projects substantially harder and could require data centers to bear the costs of their electricity and gas service, so the net effect is a severe restriction rather than an outright ban.

Timing

Ends
90 days after the Department issues regulations under § 31-0107 and the Public Service Commission completes all actions required under § 66-x

The moratorium applies to permits for siting, construction, or operation of a data center; it does not apply to modification, renewal, reissuance, or recertification of previously issued approvals. The bill states no extension condition. Other provisions remain. The moratorium’s ending condition

People behind it

  • Sponsor of the Senate bill.

  • Co-sponsor.

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  • Tasked with preparing the environmental impact report and promulgating regulations.

  • Consulted in preparing the environmental impact report and data-center regulations.

  • Consulted in promulgating data-center regulations.

  • Tasked with reporting on data-center rate impacts and issuing orders to address those impacts.

  • Consulted in preparing the environmental impact report.

Restrictions & requirementsHide restrictions & requirements3
  • A moratorium bars state and local agencies and public benefit corporations from issuing permits or other approvals for siting, construction, or starting operation of a data center capable of using at least 20 megawatts. It remains in effect until 90 days after the Department of Environmental Conservation issues regulations and the Public Service Commission completes its required actions. It does not apply to modification, renewal, reissuance, or recertification of an already-issued approval. The permit moratorium and exception

  • The Department must complete an environmental impact report before issuing new or updated data-center regulations, and cannot issue those regulations sooner than three years after the section takes effect. The regulations must be additional to existing requirements and are to address energy use, pollution, noise, water use, burdens on disadvantaged communities, and minimum use of renewable electricity and energy storage. The timing and required scope of the regulations

  • No sooner than three years after enactment, the Public Service Commission must issue any additional orders needed to minimize data centers’ impacts on electricity and gas rates and require data centers to bear all costs of providing and maintaining their electric and gas service, including associated infrastructure and market costs. Costs shall be borne by the data center

Benefits & exceptionsHide benefits & exceptions2
  • Previously issued permits may be modified, renewed, reissued, or recertified during the moratorium. The moratorium does not apply to previously issued approvals.

  • Facilities below the 20-megawatt threshold are outside the bill’s definition of a data center, unless they are part of a qualifying aggregated site. The definition sets a 20-megawatt threshold.

Sources

pending · Statewide
Would regulate large data-center development in New York by imposing a one-year approval moratorium for facilities with peak demand of at least 20 megawatts, requiring host-community hearings, and directing the Department of Environmental Conservation to prepare a statewide environmental-impact report.New York S10642 (2026)

What this means

The bill would block DEC permits for new large data centers for one year, while exempting projects already under construction, so it is a major but temporary barrier—not a complete ban. After that, large centers would face new utility-rate and community-benefit requirements, and facilities of 5 MW or more would have renewable-energy and construction-labor obligations, adding ongoing costs and compliance work. One-year permit moratorium

Timing

Ends
one year after the effective date of this section

The moratorium applies to permits and other approvals for large data centers. It excludes modifications, renewals, reissuances, or recertifications of previously issued approvals and centers already under construction by the effective date. The bill states that the act takes effect immediately; no expiration is specified for its other provisions.

People behind it

  • Sponsor of Senate bill S10642.

  • Co-sponsor of S10642.

  • Co-sponsor of S10642.

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  • Co-sponsor of S10642.

  • Co-sponsor of S10642.

  • Co-sponsor of S10642.

  • Co-sponsor of S10642.

  • Co-sponsor of S10642.

  • Co-sponsor of S10642.

  • Co-sponsor of S10642.

  • Co-sponsor of S10642.

  • Sponsor of Assembly bill A11560; the Assembly version was introduced at her request.

  • Co-sponsor of A11560; the Assembly version was introduced at her request.

  • Co-sponsor of A11560; the Assembly version was introduced at her request.

  • Co-sponsor of A11560; the Assembly version was introduced at her request.

  • Co-sponsor of A11560.

  • Co-sponsor of A11560.

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  • Co-sponsor of A11560.

  • Co-sponsor of A11560.

  • Co-sponsor of A11560.

  • Introduced A11560 at the request of Assembly Members Barrett, Kelles, Tapia, and Glick.

  • Would administer large-data-center permits and prepare the statewide environmental impact report.

  • Would oversee utility rate classifications and adjustment mechanisms, and establish the host-community benefits program.

  • Would coordinate on large-data-center hearings and bear hearing-related costs specified in the bill.

  • Would consult on the statewide environmental impact report.

  • Would consult on the environmental impact report and host-community water-impact measures.

  • Would consult on the environmental impact report and participate in the electricity-cost adjustment mechanism and efficiency-goal process.

  • Would help determine data-center energy-consumption efficiency goals.

  • Would consult on the host-community benefits program.

  • Would consult on the environmental impact report and host-community benefits program.

  • Would consult on the environmental impact report’s review of public funds and incentives received by data centers.

  • Would establish a host-community benefits program for large data centers in its service territory.

  • Would determine data-center energy-consumption efficiency goals, including waste-heat recycling goals.

  • Would establish separate large-data-center service classifications and assign applicable service costs to those classifications.

  • Would have enforcement jurisdiction over construction labor requirements; the bill defines this as the Commissioner, with a city comptroller or analogous officer for qualifying city-permitted projects.

Restrictions & requirementsHide restrictions & requirements8
  • For large data centers with peak demand of at least 20 MW, the Department of Environmental Conservation may not issue a permit, certificate, license, or other approval for one year after the provision takes effect. Exceptions cover renewals or modifications of existing approvals and centers that began construction by the effective date. No permit, certificate, registration, license, or other form of approval

  • Before receiving a permit or other approval, a large data center must hold at least one in-person public hearing in a host community at least three months before approval. Residents must receive at least 30 days’ advance notice, and the operator must pay the hearing expenses. not less than three months before the issuance

  • Large data centers—those with peak demand of at least 20 MW—must be placed in separate electric, gas, and water service classifications. These rates and terms must allocate the facilities’ attributable infrastructure, administrative, operational, and other specified costs to them, and adjustment mechanisms must pass through attributable commodity-cost increases. The classifications and mechanisms must be implemented by June 1, 2030. assign the costs incurred

  • Data centers with peak loads of at least 5 MW must meet renewable-energy procurement targets, verified annually by an independent third party: at least one-third for 2030–2034, two-thirds for 2035–2039, and 90% from 2040 onward. They must also obtain as much energy as technologically, environmentally, and practically feasible from on-site renewables. at least ninety percent

  • Data-center operators must comply with energy-efficiency goals, including goals for recycling waste heat, developed by the authority and reviewed annually. Operators already operating when the provision takes effect have two years to comply; operators beginning operation within the following year have one year. shall determine reasonable energy consumption efficiency goals

  • A new large data center, or an existing large data center undergoing a major expansion adding at least 20 MW of load, must fund a host-community program for residential technologies, community infrastructure, and measures to prevent specified water and wastewater impacts. The Public Service Commission must establish the program, with community input; the operator must submit independently audited financial reports annually. shall fund a program

  • Construction or expansion of a data center with peak demand capacity of at least 5 MW is subject to prevailing-wage requirements, apprenticeship or workforce-training requirements, and a requirement that iron and steel used in construction be produced or made wholly or substantially in the United States. The prevailing-wage exception applies to projects under qualifying pre-hire collective bargaining agreements. peak demand capacity of five megawatts or more

  • Community-infrastructure projects funded under the host-community program with construction costs of at least $1 million are subject to prevailing-wage requirements, subject to specified exceptions, including qualifying pre-hire collective bargaining agreements and certain residential projects. total construction cost of not less than 1 million dollars

Benefits & exceptionsHide benefits & exceptions5
  • The one-year permit moratorium does not apply to large data centers already under construction on or before its effective date. The exception for centers commencing construction preserves their ability to proceed.

  • The moratorium also does not bar modification, renewal, reissuance, or recertification of a previously issued permit, allowing covered facilities to pursue those permit actions during the moratorium. The exception for previously issued permits

  • Covered data centers—those with peak demand of at least 5 megawatts—are generally subject to prevailing-wage rules for construction, but that requirement does not apply when construction or expansion is performed under a qualifying pre-hire collective bargaining agreement. The collective-bargaining exception can reduce that labor-cost obligation.

  • Data center operators receive time to meet energy-efficiency goals once those goals are set: operators already operating have two years to comply, while operators that begin operating within one year after the relevant effective date have one year. The compliance periods

  • For data centers with peak loads of at least 5 megawatts, renewable-electricity procurement thresholds are phased in rather than required immediately: one-third for 2030–2034, two-thirds for 2035–2039, and 90% beginning in 2040. The staged renewable-energy targets

Sources

pending · Statewide
Would require large energy-use facilities, including computing facilities with peak demand of at least 20 megawatts, to bear the full costs of serving them rather than shifting those costs to other ratepayers.New York S8540A (2025-2026)

What this means

The bill would require data centers with peak demand of at least 20 MW to pay a separate share of service costs, including infrastructure and operating costs, which could make building or expanding them more expensive (costs assigned to the large-facility class). It does not ban projects or add permitting delays, and financial guarantees are only something the department may require, so the added burden is meaningful but limited (financial surety requirements).

People behind it

  • Senate sponsor of S8540A and named sponsor in the bill materials.

  • Senate co-sponsor and one of the senators identified as introducing the measure.

  • Senate co-sponsor and one of the senators identified as introducing the measure.

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  • Senate co-sponsor and one of the senators identified as introducing the measure.

  • Senate co-sponsor and one of the senators identified as introducing the measure.

  • Listed as a Senate co-sponsor of the active measure.

  • Senate co-sponsor and one of the senators identified as introducing the measure.

  • Assembly sponsor of the companion bill A9039B.

  • Assembly co-sponsor of A9039B.

  • Assembly co-sponsor of A9039B.

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  • Assembly co-sponsor of A9039B.

  • Assembly co-sponsor of A9039B.

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  • Assembly co-sponsor of A9039B.

  • Assembly co-sponsor of A9039B.

  • Assembly co-sponsor of A9039B.

  • Administers the measure by approving service classifications, establishing adjustment mechanisms, and ensuring implementation.

  • May promulgate regulations concerning financial surety requirements for large energy use facilities.

  • Coordinates with the Public Service Commission on the required adjustment mechanism.

  • Must establish and file the required service classifications and implement approved classifications and adjustment mechanisms.

  • Must establish and file the required service classifications and implement approved classifications and adjustment mechanisms.

  • Must establish and file the required service classifications and implement approved classifications and adjustment mechanisms.

Restrictions & requirementsHide restrictions & requirements5
  • Facilities with a peak demand of 20 megawatts or more used for computing infrastructure, data processing, web hosting, streaming support, or related functions must be placed in a separate service classification from other utility customers. The commission shall require ... an independent classification of service for large energy use facilities

  • The separate classification must assign entirely to covered large energy use facilities the costs of infrastructure upgrades, improvements, additions, and operating expenses needed to provide and maintain their service, while also assigning attributable rate-of-return costs to them and protecting other customer classes from related fixed-charge or surcharge increases. assign the costs incurred ... to serve large energy use facilities

  • The Public Service Commission, coordinating with the federally designated bulk system operator, must establish and annually update an adjustment mechanism requiring covered facilities to bear costs attributable to increases in commodity prices, including transmission service fees. shall establish, implement, and annually update an adjustment mechanism

  • The Department may adopt financial-surety requirements as a condition of providing service to large energy use facilities, including insurance, guarantees, surety bonds, letters of credit, or qualification as a self-insurer. may promulgate regulations regarding financial surety requirements

  • After the act takes effect, the Public Service Commission may not approve a utility or municipal request to change rates or update a tariff unless the proposal includes the required large-energy-use-facility classification and compliant adjustment mechanism. not approve any change of rates or related updates to a tariff

Sources

pending · Statewide
Would regulate proposed data centers with projected energy-use capacity of at least five megawatts to reduce energy and water consumption, fossil-fuel reliance, emissions, pollution, waste heat, and community impacts; the measure has not become law and its bill text would make it effective one year after enactment.New York S6394A (2025-2026)

What this means

The bill applies to large data centers projected to use 20 or more megawatts and requires advance disclosures, public hearings, and annual reports, adding compliance work and some project lead time. It also sets efficiency goals and penalties for reporting violations, but does not ban development or set a firm limit on data center operations.

People behind it

  • Primary sponsor of the Senate measure and an introducing senator.

  • Senate co-sponsor and introducing senator.

  • Senate co-sponsor of the active version of the measure.

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  • Administers disclosure-report publication, public proceedings, data-center surcharges, and energy-affordability bill credits.

  • Receives required disclosure reports and is authorized to issue regulations and enforce reporting requirements.

  • Authorized to enforce the measure's data-center reporting provisions.

  • Works with the bulk system operator, Public Service Commission, and Climate Action Council to establish and update data-center energy-efficiency goals.

  • Collaborates in developing data-center energy-consumption efficiency goals.

  • Collaborates in developing energy-efficiency goals aligned with the Climate Leadership and Community Protection Act.

  • Implement the regulated data-center surcharge and transfer proceeds for energy-affordability bill credits.

Restrictions & requirementsHide restrictions & requirements11
  • Regulated data centers—those projected to have an energy-use capacity of at least five megawatts—must submit a disclosure report to the Department and Public Service Commission at least 180 days before beginning construction.

  • The preconstruction disclosure report must include the proposed facility’s location and type, employment and workforce information, projected energy use and sources, off-site carbon-dioxide-equivalent emissions, waste heat, and applicable water use and discharges.

  • The Public Service Commission must publish the disclosure report within 10 days, and the operator must hold at least two public hearings within 60 days after submitting it, including at least one hearing in the host community.

  • Operators must provide host-community residents at least 30 days’ advance notice of the hearings, and a draft disclosure report must be publicly available at least 30 days before the first hearing.

  • Regulated data center operators must submit annual disclosure updates covering changes in operations, energy and water use, fossil-fuel and renewable-energy efforts, pollution, waste heat, and host-community employment; the Commission must post each report within 15 days.

  • Operators that fail to comply with the disclosure requirements receive 60 days to cure the violation; afterward, they may face fines of up to $10,000 and an additional $10,000 for each day of continued noncompliance.

  • Energy-consumption efficiency goals for data center design and operation must be established within one year, including possible waste-heat recycling requirements. Existing operators have two years to comply, while operators that began operating within one year after the act’s effective date have one year.

  • Power-purchase agreements for fossil-fuel-generated energy may not provide regulated data centers with economic incentives or discounts.

  • Regulated data centers must obtain increasing amounts of energy through power-purchase agreements exclusively for renewable energy: at least one-third by 2030, at least two-thirds by 2035, and all energy by 2040.

  • The Public Service Commission must establish a surcharge on all regulated data centers sufficient to cover transmission and distribution upgrades needed for their grid interconnection and operation, as well as directly resulting increases in energy-supply costs.

  • Electric utilities must implement the regulated-data-center surcharge within one year after the act’s effective date, and the Commission must review and update it every three years.

Benefits & exceptionsHide benefits & exceptions2
  • Data centers projected to use less than five megawatts are excluded from the definition of a “regulated data center.” As a result, they are not subject to the measure’s regulated-data-center disclosure, public-hearing, annual-reporting, surcharge, or renewable power-purchase requirements, although other requirements may still apply.

  • Existing data center operators receive up to two years to comply with newly developed energy-consumption efficiency goals. Operators that began operating within one year before the measure’s effective date receive one year to comply, delaying the operational burden of those goals.

Sources

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