New York’s Data Center Ban Won’t Solve Its Grid Problems

Дата публикации: 06-08-2026 13:00:04

New York isn’t particularly inundated with new data centers, but it just became the first U.S. state to ban them. In an executive order on 14 July, Governor Kathy Hochul imposed a moratorium of up to a year on data centers that consume 50 megawatts of power or more. The ban arose from concerns about data centers’ power and water use and effects on residential electricity bills. Such worries have risen sharply across the U.S. over the last year as more developers propose projects and request grid connections. Data-center energy use in the country is expected to exceed 650 billion kilowatt-hours by 2050, doubling to quadrupling today’s consumption.Virginia, Texas, and California have received an onslaught of data centers, sparking public backlash and sending grid operators scrambling to keep up. But in New York that’s not the case. Electricity margins in the state’s grid are running thin and power bills are rising, but data centers aren’t to blame—for now. “I don’t think we’ve actually seen those fights in New York,” says Daniel Zarrilli, who most recently served as the chief climate and sustainability officer at Columbia University and was previously New York City’s chief resilience officer and chief climate-policy advisor. “We’re seeing the anticipation of those fights, which is what I imagine led to the moratorium.”So the governor’s move is preemptive—and it alone won’t fix the state’s energy woes. “Anytime you open the paper, figuratively speaking, these days, there’s all this discussion about data centers,” says Kevin Lanahan, senior vice president of external affairs and corporate communications at New York Independent System Operator (NYISO), which runs the state’s power grid. “But the increase in demand that we have experienced and been tracking really has not been attributable to data centers yet.” Rather, Lanahan says, New York’s razor-thin electricity margins are mostly a result of the increasing electrification of the state’s building and transportation sectors. That is only expected to continue, and Lanahan says it will drive forecasted grid strain alongside new manufacturing facilities in NYISO’s territory. “We have some modern manufacturing and some traditional manufacturing in the queue that promises to increase the demand going forward,” Lanahan says. For example, he cites a Micron semiconductor plant under construction near Syracuse that could consume over 1 gigawatt when complete. Making matters more difficult, NYISO’s aging grid infrastructure isn’t up to the task of meeting new demand. “What we need is new dispatchable generation,” he says. “Hard stop.” Why New York’s Power Grid Is VulnerableNew York’s move is an indicator that the U.S.’s burgeoning anti–data center movement has gained traction. Bans on the power-hungry facilities have proliferated over the past year at the county and municipal levels, but this marked the first statewide prohibition. Texas on Monday followed suit in the form of a directive by Governor Greg Abbott ordering the state’s grid operator to pause new data-center connections until it completes an audit of proposed facilities.The New York ban comes just a month after NYISO announced that New York’s grid wouldn’t have much headroom this summer. Only 417 MW of extra power is available during typical peak demand, NYISO estimates—the lowest summer reserve margin since 2017. Additional pressure on the grid, such as from extreme temperatures, could make margins even thinner and force the use of higher-polluting backup plants. Since 2019, 2.9 GW of power generation have been added to New York’s grid, but 4.4 GW have come offline, according to a NYISO report published in June. The retired facilities were largely fossil-fuel powered and have been taken out of the system because of factors such as mechanical issues and performance decline.As a result of the mismatch, summer reserve margins have decreased by 1,810 MW since 2019. “We have what we assess to be the oldest-generation fleet in the country,” Lanahan says. During heat waves, like one that occurred over the July 4 weekend, NYISO must turn on some of those old facilities. “We’re relying routinely…on old steam, peaking units that were built sometimes 70 years ago,” he says.Meanwhile, the requests for new connections to the grid keep coming. In total, about 14 GW worth of large electricity load await review in NYISO’s grid interconnection queue. Twelve of those gigawatts come from data centers and crypto-mining facilities spread across 40 projects. All but two exceed the moratorium’s 50 MW threshold. NYISO will need to study the requests to see how they’ll impact its system before allowing them to connect. Lanahan says the agency is planning for only about 3 GW to come to fruition within the next 10 years, because projects routinely withdraw from the process or are subject to delays. “Together we’ve got these two bookends: the increased poor performance of the system because we’re relying on aging infrastructure, and then that future challenge to meet,” Lanahan says. Solutions such as demand response to manage the increased load aren’t enough, he says. Some facilities could build their own power generation—something NYISO is developing rules around in accordance with a Federal Energy Regulatory Commission directive issued earlier this summer. IEEE Spectrum reached out to Hochul’s office to determine what the state government is doing to address New York’s shrinking reserves and aging fleet. Senior energy and environment communications advisor Ken Lovett says that the state is prioritizing renewable energy such as wind and solar, plus a nuclear reliability initiative that will add a backbone of 5 GW to the system. “Governor Hochul will never sacrifice the reliability of the grid,” Lovett says. Large manufacturing facilities, such as a Micron semiconductor plant currently under construction in upstate New York, are a major factor driving future electricity demand in the state.Mike Groll/Office of Governor Kathy HochulNew York’s Data Center Ban Buys TimeSo New York’s ban on data centers is addressing only part of the problem, and a largely future one at that. It will have no effect on NYISO’s interconnection queue, Lanahan says, as the executive order only bans environmental permitting of data centers, not their grid connection. “Projects are still there,” he says. Project developers are “still working with us on the exchange of information that’s requisite to complete what’s called a system impact study. That’s the responsibility we have in that process.” New York’s moratorium is set to lift when the state’s Department of Public Service completes an assessment of the impact of data centers. Governor Hochul called for using the time, which could last up to a year, to build a regulatory framework that protects the state’s electricity supply, utility bills, and the environment. Zarrilli, formerly at Columbia University, says that it’s “hard to imagine” the moratorium being extended beyond a year. The governor “continues to support AI and the data centers that drive it,” Lovett says. Asked about the usefulness of the moratorium, Zarrilli says he’s “hopeful” that the pause can give the state time to plan for the future grid issues posed by data centers. Still, he says there’s the possibility that a year is simply not enough time. “There’s a scenario for sure where the state takes this time and comes up with a thoughtful path forward for managing the growth and strengthening the grid, and doing it in a way that’s affordable for New Yorkers,” he says. “And then there’s clearly a possible scenario where the time runs out and we haven’t done those things, and then it’s a scramble to figure out what to do next. That latter option would be tragic.”

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