Trump presses New York to reverse AI data center pause

President Donald Trump urged New York to reverse a new pause on some large data center projects, putting fresh political pressure on one of the key bottlenecks in the artificial intelligence buildout: electricity. For investors watching AI, the fight matters because data centers are the physical infrastructure behind the software boom, and their power and water use is now drawing more scrutiny from voters and state officials.

In a Truth Social post Wednesday, Trump criticized New York Gov. Kathy Hochul and said the state should change the policy “IMMEDIATELY.” CNBC reported that New York became the first U.S. state to impose a ban of this kind.

Hochul signed an executive order Tuesday that blocks construction of large-scale data centers using 50 megawatts or more of power for as long as one year. A megawatt is a unit of electricity demand, and a 50-megawatt threshold applies to facilities that can place a meaningful load on the grid.

Trump framed data centers as an economic prize for states. “One of the biggest Driving Forces in the Future for Jobs, are Data Centers,” he wrote on Truth Social. He called them “Money Machines for the State in which they are built” and said Hochul had, “for political reasons,” stopped data centers from being built in New York.

He added that “New York State has made a terrible decision,” according to the post.

Hochul’s office described the moratorium as a response to costs and resource concerns tied to the data center boom. In a press release announcing the order, Hochul said data center development threatens to increase utility bills, strain natural resources and create uncertainty for New Yorkers.

The policy lands as public pushback against data centers has grown nationally, CNBC reported. The concern is straightforward: AI services need large computing facilities, those facilities need power and, in many cases, water for cooling, and residents worry that the buildout could make household utility bills more expensive.

CNBC reported that utility prices have continued rising while AI demand has surged, feeding a rapid infrastructure expansion. That has turned data centers from a tech-industry issue into a local affordability issue, especially in places where new projects require more electric capacity.

The politics are also sharpening ahead of the midterm elections, according to CNBC. Democrats have focused on affordability, while local anger over new builds has kept attention on whether data center operators should absorb more of the costs tied to power and water use.

Trump also addressed that cost question in his post. He said data centers “must pay” for their own water and power, with any remaining benefits going back to state and local communities.

CNBC said it contacted Hochul’s office for comment.

This story draws on original reporting from CNBC.