MONTICELLO – The Sullivan County Legislature pledged its unanimous support for two New York State Assembly bills aimed at regulating data centers during a special meeting on June 4. 

The first bill proposes a surcharge on electricity consumed by data centers to finance grid modernization, while the second seeks a moratorium on new data centers to ensure responsible development.

“When we’re talking about data centers, they look at communities like ours,” said District 5 Legislator Cat Scott, who cited the data center currently being proposed just across the river in Wayne County, PA. 

 “It takes up a lot of power,” continued Scott. “The last resolution that we just passed was about saying that if you have a data center, the amount of money that it takes to upgrade the grid should be on the data center and not the ratepayers like us. And we’re seeing that utility rate payers are struggling to pay their electric bill… This is about how we want our community to develop and about sustainability—financial sustainability and environmental sustainability.”

New York Assembly Bill A10049, sponsored by District 100 Assemblywoman Paula Kay, would require the Public Service Commission to impose a surcharge on utilities for data centers that meet a specific threshold of electricity use or information-technology load. 

This surcharge would then be used to establish the grid modernization fund to finance investments in system reliability, capacity expansion, and integration of clean energy resources. The bill would also safeguard against passing the surcharge on to utility customers and includes a surcharge exemption for data centers that derive at least 90% of their annual energy consumption from renewable resources.

Another bill, New York Assembly Bill A10141A, would impose a moratorium on issuing permits for new data centers and require the Public Service Commission to issue an order to minimize the impact of new data centers on electricity and gas rates for residential, commercial and industrial users. 

Scott quoted a report by the United States Department of Energy that said U.S. data centers consumed roughly 176 terawatts (1 terawatt=1 trillion watts) in 2024. 

“They want to double the amount of data centers we have now, so right now we’re using 176 terawatt hours,” said Scott. “By 2028 it could be between 325 and 580 terawatt hours. So within the next two years, we could see that usage double.”

When District 7 Legislator Joe Perrello asked why data centers are located near rivers, Legislative Chair Nadia Rajsz responded, “They need water.”

Scott explained: “They use a tremendous amount of water to cool the systems in the U.S. In other countries, they build these differently so that they are more sustainable. So here we do a cheaper, easier version, and we use a lot of resources.” 

One example of a more sustainable design is the LUMI supercomputer cluster in Kajaani, Finland, which is powered entirely by hydroelectricity and uses its waste heat to heat the adjacent business park. 

Bills A10049 and A10141A must pass the New York State Assembly and the New York State Senate before reaching Governor Hochul’s desk for signature. On June 4, the Sullivan County Legislature showed their unanimous support of both bills in what may be the first step of county action on data centers, while towns begin to contend with their own regulations. 

The Town of Highland will hold a public hearing tonight, June 9, at 6:30 p.m. at the Town of Highland Senior & Community Center, 725 State Route 55, Eldred, to consider a proposed local law regarding package plants and data centers within the Town of Highland.

The purpose of the proposed local law is to establish standards and requirements governing the siting, construction, operation, maintenance, expansion and oversight of package plants and data centers.

We will continue to update this story.