Given the long construction times and high energy demands of this asset class, a twelve-month delay can have severe financial implications. On 14th July, New York Governor Kathy Hochul signed the state's first moratorium on the construction of new hyperscale data centres, suspending all state environmental permits for up to one year. According to Hochul's announcement, the aim is to "create a statewide leading regulatory framework that protects ratepayers, the environment, the power grid, and communities across the state."
At a time when data centre construction has become a national gold rush, with states vying for jobs and the economic value added by new data centre activities, many are wondering whether the moratorium will prove costly for New York. According to the engineering and supply chain platform Accuris, the five largest hyperscalers – Amazon, Microsoft, Google, Meta, and Oracle – are expected to invest over USD 600 billion in infrastructure in 2026, representing a 36 per cent increase compared to 2025.
To illustrate how quickly the industry is evolving: in mid-2025, Goldman Sachs predicted that hyperscaler capital expenditure would reach USD 1.15 trillion from 2025 to 2027, a massive increase compared to the USD 477 billion spent from 2022 to 2024. However, the investment bank drastically revised its own estimates just one year later, now forecasting that hyperscaler capital expenditure could reach USD 1.1 trillion in 2027 alone. It is therefore understandable that some states are fiercely competing for these investments and the associated jobs, and that states with lenient regulatory frameworks are making gains while a state like New York takes a pause.
Texas and Virginia lead in terms of current data centre capacity and willingness to build as many additional data centres as possible. According to Cleanview, a market research firm that tracks large hyperscale data centres with identifiable power capacity, Virginia currently has 371 operational data centres with a combined capacity of 17,378 megawatts (MW). In addition, another 438 projects are planned, expected to add 36,406 MW. The largest existing data centre in the state has a capacity of 243 MW, while the largest planned facility will reach 2,400 MW. At least nine planned centres will exceed the current maximum of 243 MW. In total, 140 different developers are involved in such projects in Virginia.
Texas currently has 129 facilities with a total output of 7,036 MW, with 241 further facilities planned by 95 different developers, expected to add another 98,633 MW. The largest current facility has a capacity of 750 MW; the largest planned facility is significantly larger at 7,650 MW. In comparison, New York is a much smaller player in the data centre sector. With nine facilities offering 205 MW, current plans envisage 25 further facilities with a total capacity of 9,797 MW from 27 developers.
The states that promote the massive expansion of data centres also benefit from it. Virginia's Joint Legislative Audit and Review Commission (JLARC), which conducts policy analyses on behalf of the state legislature, found that Virginia's data centre industry "annually contributes an estimated 74,000 jobs, USD 5.5 billion in labour income, and USD 9.1 billion to Virginia's GDP." Nevertheless, the news is not exclusively positive for all data centre-friendly states. While Virginia's energy demand remained essentially constant from 2006 to 2020, JLARC estimates that "unrestrained power demand in Virginia would double within the next 10 years, with the data centre industry being the primary driver."
The Commission further stated that building sufficient infrastructure to meet this demand – or even half of it – would be "very difficult to achieve," and that the increased demand "would likely increase system costs for all customers, including non-data centre customers." While New York is the first state to issue a statewide moratorium, other states are also taking measures to prevent environmental damage and economic disadvantages for residents. Similarly, communities across the country, including in Texas and Virginia, have resisted despite the clear economic benefits. In January 2025, the Georgia Public Service Commission adopted a rule allowing energy provider Georgia Power to charge new customers consuming more than 100 MW costs that include minimum billing requirements and address "risks associated with large consumers."
The Commission is also currently investigating whether data centres pass on fuel costs to other utility customers. Even in Texas, known for being business-friendly, Governor Greg Abbott called for comprehensive regulations for the state's data centres in June 2026 to ensure that "Texans are not burdened with the costs of infrastructure driven by data centre expansion." Juan Arias, National Director of U.S. Industrial Analytics at CoStar, explained that the nationwide development of data centres has already had a strong upward effect on electricity prices paid by all consumers. Arias noted that electricity prices per kilowatt-hour in the United States stagnated at around 14 or 15 cents per kilowatt-hour for over a decade. "In the last four or five years, in parallel with data centre construction, they have risen at an annual growth rate of 7 per cent above inflation and are now closer to 20 cents per kilowatt-hour," said Arias. "So, there has been an impact on the price of electricity, and much of that is due to the capital costs of building new power capacity for these data centre projects."
