New York could become the first state to place a moratorium on building massive new AI data centers, as legislators plan to pass a one-year ban on construction of the energy-devouring facilities amid backlash.

The state legislature will vote on a bill to prevent new data centers from being built in the Empire State for 12 months over concerns of their impact on surrounding communities.

“We intend to pass it,” Assembly Speaker Carl Heastie (D-Bronx) told reporters Tuesday. But Gov. Kathy Hochul, who has hinted at her disapproval, will need to sign off on the legislation for it to become law.

The data centers have sparked an outcry from diverse groups concerned about straining communities’ energy supply, driving up already sky-high electric utility rates, increasing environmental pollution and complaints about Big Tech and AI interests trampling on neighborhoods.

The measure is meant to be a compromise, as a different bill would have imposed a three-year ban on construction. The legislation was introduced Monday by state Sen. Kristen Gonzalez and Assemblymember Didi Barrett (D-Poughkeepsie), chair of the energy committee.

Under the new bill, the state Department of Environmental Conservation must complete an impact study in 18 months, recommending new regulations and oversight and hold public hearings before issuing permits to companies.

The legislation would also impose green energy use standards in data centers, requiring them to derive at least one-third of their electricity consumption from renewable sources from 2030 to 2034 and at least two-thirds from 2035 to 2039.

Companies seeking to build data centers would also be subject to bargaining with unions in the construction trades and abiding by New York’s hefty prevailing wage standards.

The bill faces opposition from the Business Council of New York State and other corporate advocates.

But Ithaca Assemblymember Anna Kelles (D-Tompkins) said the moratorium is needed to assess environmental impacts.

“We need a pause so that we, the government, can catch up. We need to evaluate the impact on water. We need to evaluate the impact on air, on water pollution, on noise pollution, on farmland impacts on electronic waste,” Kelles said during a Monday rally in Albany for the moratorium.

“And then we need to put regulations in place to minimize that impact so that we have longevity of the environment we are all living in.”

Laura Wheelock, executive director of the Public Utility Law Project, warned that the rapid expansion of AI data centers in other states triggered “unacceptable utility rate increases for everyday consumers.”

“New York must act now to protect households and small businesses from subsidizing the electric infrastructure needed to serve some of the world’s largest, most profitable corporations,” she said.

The Business Council called the moratorium a misplaced, knee-jerk reaction.

“New York should treat data centers as an essential component of its economic infrastructure and focus on how to ensure adequate data capacity as part of its overall economic development and energy planning efforts,” said Ken Pokalsky, the Business Council’s vice president of government affairs.

The business group also claimed that data centers could help stabilize utility rates for New York residents by their presence, not raise them.

“New York is facing significant reliability and cost issues within its electric power system. But those problems were not caused by data centers,” the Business Council said in a letter of opposition.

“Additional data center capacity is essential to support technology advancements in virtually all sectors of the state’s economy – and in a growing share of New Yorkers’ everyday lives. While AI is an important user of data centers, these centers support everything from remote work, telemedicine, all categories of e-commerce and financial services, to communications and media service, government and education services, among many others.”

Other signatories on the letter of opposition include Tech:NYC, the Bronx Chamber of Commerce and the Long Island Association.

Hochul threw cold water on the proposed moratorium.

She said municipalities — not Albany — should decide whether to accept or reject data centers.

“This is a local decision for municipalities. It’s land use, which is the purview of local governments,” Hochul told reporters last week.