New York data center surge presents economic development conundrum

By Marie J. French | 12/24/2025 06:11 AM EST

Proposed data centers in the state would require huge amounts of power while likely bringing few long-term jobs.

Cars drive past data centers that house computer servers.

Data center proposals in New York pose questions for economic development officials and lawmakers. Ted Shaffrey/AP

ALBANY, New York — As the artificial intelligence industry’s thirst for power threatens New York’s grid reliability, local and state economic development officials are facing a laundry list of tough questions.

Environmental advocates and some Democratic officials want to block these massive energy users — or at least limit public subsidies for projects expected to create few jobs following construction.

“Over my dead body,” said Democratic Assemblymember Jen Lunsford, when asked about public incentives for data centers. “The only economic impact — positively — of a data center is in the construction of it. … It’s a giant warehouse that has the carbon footprint of a small European country. Why? Why do we want those in our state?”

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More than 12,000 megawatts of power are being sought by large new energy users in New York. More than three-quarters of that is for potential AI data centers.

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