Moody’s Ratings has warned that at least 14 US states are considering statewide moratoriums in 2026, cautioning that the pace of data centre expansion is straining electricity and water infrastructure to a degree that raises credit risk for host state and local governments. North America absorbed a record 25GW of data centre capacity in the first half of 2026, according to JLL, double the volume of a year earlier.
New York became the first US state to act, when governor Kathy Hochul signed an executive order in July pausing state environmental permits for new data centres of 50MW or more for up to a year. The order cited nearly 12GW of data centre load requests sitting in the New York Independent System Operator’s interconnection queue as of May, with more than eight gigawatts of that arriving in 2025 alone. Capacity’s analysis of who the 50MW threshold actually catches found colocation and enterprise operators largely untouched.
Pennsylvania followed in August. Governor Josh Shapiro signed an executive order requiring data centres above 25MW to secure local approval before the state will consider a permit, alongside mandates to cover their own power and transmission costs. Shapiro, who previously championed the sector, said he would “not allow Pennsylvanians to be bullied by greedy developers.”
Texas took a different route. Rather than a moratorium, governor Greg Abbott ordered the Electric Reliability Council of Texas (ERCOT) and the Public Utility Commission of Texas to audit every data centre project advancing through the grid’s interconnection process, after requests reached 474GW, more than five times the state’s record peak demand. The scope has since narrowed to between 250 and 300 projects representing around 200GW, but no project can proceed until the review concludes.
Scotland is the latest legislature to force the issue. MSPs vote on Wednesday on a Scottish Greens motion to pause all hyperscale data centre applications until the government publishes a national strategy. The party says the 24 outstanding applications now before Scottish planning authorities would, if approved, draw around 1.5 times as much electricity as the whole country currently uses at peak times.
In Finland, opposition parties are calling for a national permitting system after Google confirmed a €13 billion investment in the country’s digital infrastructure, its largest single commitment in Europe to date, warning that no coordinated oversight of the resulting power demand currently exists.
Ireland shows the other direction of travel. Energy regulator CRU imposed an effective halt on new data centre grid connections in the Dublin area in 2021, but lifted it last December, allowing new connections provided operators meet at least 80% of their energy demand from renewable sources annually. Data centres accounted for 23% of Ireland’s total electricity consumption in 2025, up from 21% the year before, according to the Central Statistics Office, even with the connection halt in place for most of that period.
The financing side is starting to reflect the pattern. Senior bankers have told Reuters they are now weighing community sentiment alongside credit quality when assessing data centre loans, after a run of project withdrawals including Amazon Web Services pulling its application in Calvert County, Maryland, and QTS abandoning its $30 billion Digital Gateway project in Prince William County, Virginia. Research firm Data Center Watch estimates at least 75 major projects representing more than $130 billion in investment were delayed or cancelled in the first quarter of 2026 alone, with organised local opposition cited as a contributing factor.
What distinguishes the current wave from earlier local zoning disputes is its level: state governors, national parliaments and grid operators are now writing the rules directly, rather than leaving the issue to individual counties.
Texas, long the sector’s most permissive market, freezing its own approvals pending an audit sends a different signal to lenders than a single county vote. Ireland’s reversal is the other half of the picture: even a five-year connection halt didn’t stop data centres’ share of national electricity climbing to nearly a quarter, suggesting pauses alone don’t resolve the underlying demand.
Related stories:
- New York data centre moratorium: Who will get off unscathed?
- Texas hits pause on its own AI boom: Inside the 300-project grid audit
- Scotland to vote on hyperscale pause as SNP’s own council breaks with Swinney
- Finland’s opposition calls for data centre permitting system after Google’s €13bn deal
- Lenders start pricing community opposition into data centre financing
Capacity Europe 2026
The 25th anniversary edition of Capacity Europe 2025 will bring together 3,500+ decision-makers from the global connectivity and digital infrastructure community.
