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S 10642

Enacts the responsible data center development act

2025 Regular Session Introduced by Samra Brouk and 10 co-sponsors

Imposes a one-year moratorium and new defenses for large data centers (5–20+ MW) including environmental review, host-community funding, renewable goals, and labor standards.

SUBSTITUTED BY A11560
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Bill Summary · S 10642

Summary of Bill S. 10642 (2025-2026) – Enacts the Responsible Data Center Development Act

Purpose and intent

  • Establishes a framework to regulate large data center development in New York, with a focus on environmental impacts, energy use, community benefits, and labor standards.
  • Introduces a moratorium on issuing new data center permits for large facilities (peak demand of 20 MW or more) for one year from the act’s effective date to allow assessment and planning.
  • Creates a comprehensive environmental impact process, independent utility classifications, energy efficiency goals, host-community protections, and labor standards for construction.

Key provisions and changes

1) Moratorium on large data center permits (Environmental Conservation Law – new Article 31)

  • Defines a data center as facilities with a peak demand of 1 MW or more used for computing, data processing, hosting, streaming support, etc., excluding certain public research institutions.
  • Large data centers are those with peak demand of 20 MW or more.
  • A one-year prohibition on issuing permits, certificates, licenses, or approvals for new large data centers (with exceptions for modifications/renewals or projects already underway).
  • Requires an in-person public hearing in host communities at least three months before permit issuance, with 30 days’ notice and detailed hearing topics including energy/water use and incentives.
  • Requires the Department of Environmental Conservation to prepare an Environmental Impact Report (EIR) addressing: current and projected data center growth, electricity and water use and sources, wastewater impacts, land use, pollution (GHG, air, water, noise), electronic waste, impacts on disadvantaged communities, and review of existing regulations.
  • Draft EIR public comment period of at least 120 days, plus at least five in-person public hearings across regions; final EIR within 18 months of law’s enactment.

2) Independent service classification for large data centers (Public Service Law)

  • Electric, gas, and water utilities must establish an independent classification of service specifically for large data centers, separate from other customers.
  • New/modified classifications must assign costs (infrastructure, rate of return, regulatory costs) to large data centers and prevent cross-subsidization to other customers.
  • Establishes an annual adjustment mechanism to ensure cost increases from commodity price shifts post-enactment are borne by the data centers.
  • Utilities may require financial surety (insurance, bonds, letters of credit, or self-insurance) for service provision to large data centers.

3) Host community benefits and energy efficiency (Public Authorities Law; Energy Law)

  • Creates energy consumption efficiency goals for data centers, aligned with climate law benchmarks (CLCPA). Goals include:
    • By 2030-2034: at least 1/3 of electricity from renewables for large data centers.
    • By 2035-2039: at least 2/3 from renewables.
    • By 2040 onward: at least 90% from renewables where feasible.
  • Requires the New York State Energy Research and Development Authority (and bulk system operator, PSC, and climate council) to establish and annually update these goals.
  • Data centers with 5 MW+ peak load must demonstrate renewable energy procurement (via contracts or on-site generation) through annual third-party verification.
  • Data centers must pursue on-site generation where feasible.

4) Labor standards for construction (Labor Law – new § 224-g)

  • Applies prevailing wage requirements to construction of covered data centers (5 MW+), subject to pre-hire labor agreements that provide for union signatory contractors.
  • Requires use of apprenticeship programs or workforce training where apprenticeship is not available.
  • Requires compliance with prevailing wage for building service work and domestic content rules for iron/steel (U.S.-made where feasible).
  • Fiscal officer (state or city comptroller, depending on project) enforces, with potential sanctions for non-compliance.

5) Host community investments and feedback (New provisions in Host Community section)

  • Establishes a program funded by large data center operators to install eligible residential technologies (e.g., heat pumps, water heaters, distributed solar, battery storage) and develop host-community infrastructure.
  • Infrastructure improvements may include broadband, noise mitigation, water and wastewater infrastructure, and community energy projects.
  • Programs must be developed through a PSC-led proceeding, with community input guiding the allocation and prioritization of investments, especially for low- and moderate-income households and disadvantaged communities.
  • Data centers must fund independent audits and annual reporting; hearings in host communities are required during the proceeding.

6) Long Island details and other administrative changes

  • South and Long Island data center provisions are similarly addressed, ensuring consistency across service territories.
  • Several amendments to existing PSC and utility frameworks to implement the new classifications and funding mechanisms.

Affected parties and potential impacts

  • Large data center developers and operators (5 MW+ to 20+ MW): face new moratorium, enhanced permitting processes, energy/renewable requirements, host-community funding obligations, and stricter labor standards.
  • Utilities (electric, gas, water): must create independent service classifications for large data centers, adjust rates, bear related regulatory costs, and implement cost-allocation mechanisms.
  • Host communities (cities, towns, villages hosting centers): gain a formal role in hearings, benefits from funded community infrastructure and energy programs, and protections against adverse environmental impacts.
  • General public and disadvantaged communities: potential reductions in environmental and health impacts through EIR-driven mitigations and targeted community investments.
  • Labor market: prevailing wage and apprenticeship requirements increase labor standards on construction projects; potential use of local workforce development programs.

Procedural and timeline aspects

  • Immediate effect: the act establishes a one-year moratorium on new large data center permits (with specified exceptions).
  • EIR timeline: a draft EIR with 120-day public comment period, five regional hearings; final EIR within 18 months of enactment.
  • Service classifications: utilities must implement new classifications and cost allocations, with full implementation targeted by June 1, 2030.
  • Energy goals: renewable energy benchmarks set for 2030–2040+ and require independent verification for 5 MW+ centers.
  • Host-community funding: a PSC-led proceeding within 90 days of enactment to begin establishing the funding program, with annual reporting and hearings.

Note: The bill has a broad scope, touching environmental, energy, economic, and labor policy, and would require substantial implementation by multiple state agencies and utilities if enacted.

Compiled from official sources — confirm details with the bill’s official record.

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