New York State was one of the first states to ban fracking and refuse permission to expand gas pipelines. Now, the battle line—in New York’s continued war on fossil fuel—has shifted to opposing datacenter expansion in the state. State governor Kathy Hochul signed an executive order last week making the state the first in the nation to implement a moratorium on new hyperscale data centers. With a flood of applications to build data centers awaiting approval, she decided to appease a coalition of environmental groups with a one-year moratorium obstruction.
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Hochul says applying the brakes to new data center construction will give the state time to establish “guardrails to reduce the risk to our energy grid” but the opposite is true. She is already hamstrung by prior state legislation, which has committed the state to attaining legislated clean energy milestones by as early as 2030. It is the data centers that will need the assurance that New York State’s energy grid will not falter. Considering NY state authorities’ commitment to meeting these clean energy targets and the reduction in firm thermal capacity that would accompany it, grid reliability may become a victim.
New York state is not at a complete disadvantage in terms of power. It can draw on power from Niagara Falls hydro and has increased its transmission capacity to receive more power from Hydro-Québec, but it has prematurely retired much of its former thermal generation capacity and replaced it with intermittent renewable sources. In addition, a lack of natural gas pipeline access in NY state and a vocal constituency that wants to rid the state of natural gas all together makes it difficult for a datacenter to provide its own power with gas generators standing ready if the grid falters.
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Combined with a political environment in the state that is generally hostile to the interests of business, especially ones that are energy intensive, it is a wonder that anyone would want to locate a data center there. However, I suppose they have solid business reasons for wanting to do so.
If one has taken a drive through upstate New York recently, except for resort towns in the Adirondack and Finger Lake region and college towns like Cornell University in Ithaca, one sees a great number of communities in economic decline. I am not saying that data centers would be a panacea for these communities, but it certainly might help. However, Governor Hochul seems content to manage decline in her state and stay true to her followers in the environmental movement.
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