Overview
New York provides established tax credits and subsidized renewable hydropower to attract large-scale data centers, but the state is also actively debating new constraints. A 2022 law temporarily banned new permits for fossil-fuel power plants serving cryptocurrency mining, and pending legislation would require renewable energy commitments and impose cost-sharing obligations on all data centers above 5 MW. The policy landscape is in flux, with economic development incentives running alongside growing legislative scrutiny of grid impacts and carbon footprint.
Incentives
Excelsior Jobs Program
The Excelsior Jobs Program offers five fully refundable tax credits for firms that meet job creation and capital investment thresholds over a benefit period of up to 10 years.[1]
- Credit structure: up to 6.85% of wages per net new job (7% for semiconductor supply chain projects, 7.5% for green projects), 2% of qualified capital investments (up to 3% or 5% for certain projects), plus R&D credits tied to New York-based expenditures.[1]
- Eligibility is limited to strategic industries including software development and scientific R&D, or to projects meeting large job-creation and investment targets.[1]
NYPA Hydropower for Economic Development
The New York Power Authority (NYPA) allocates low-cost, renewable hydropower through three programs tied to job retention, job creation, and capital investment commitments.[2]
- ReCharge NY is available statewide; Western NY Hydropower serves projects within 30 miles of the Niagara Power Project; Preservation Power covers St. Lawrence, Franklin, and Jefferson Counties.[2]
- NYPA awards power through a competitive public process and describes 7-year contracts with annual rate adjustments.[2]
NYSERDA Data Center Efficiency Program (Con Edison customers)
The Data Center Efficiency Program (DCEP) provides performance-based incentives for energy savings and study reimbursements for Con Edison customers who pay into the Systems Benefits Charge.[3]
- Incentives: $0.05–$0.16 per kWh/year saved, up to $5 million per project, plus 50% reimbursement for energy studies.[3]
Requirements and Conditions
Cryptocurrency Mining Moratorium (2022 Law)
New York enacted a two-year moratorium (November 22, 2022 to November 22, 2024) on new or renewed air permits for fossil-fuel generating facilities supplying behind-the-meter electricity to proof-of-work cryptocurrency mining operations.[4] The same law directed the Department of Environmental Conservation (DEC) to prepare a Generic Environmental Impact Statement (GEIS) for proof-of-work mining; the draft GEIS (May 2025) clarifies that it does not replace site-specific SEQR reviews but is intended to inform them.[5]
Utility and Grid Rules
Proposed Sustainable Data Centers Act
Senate Bill S6394A (Assembly companion A09086A) would create new disclosure, renewable energy, and cost-sharing requirements for data centers at or above 5 MW.[6][7]
- Disclosure: Pre-construction report and annual updates required for all regulated data centers (defined as 5 MW or greater).[6]
- Renewable energy targets: The bill would prohibit economic incentives or discounts in fossil-fuel power purchase agreements and set progressive renewable PPA targets — one-third by 2030, two-thirds by 2035, and 100% by 2040.[6]
- Data center surcharge: The Public Service Commission would establish a surcharge to cover grid-upgrade costs, with proceeds returned to low-income customers as bill credits.[6][7]
What to Watch
- S6394A / A09086A — whether the Sustainable Data Centers Act advances in the 2026 legislative session, including committee action, amendments, or re-introduction.
- DEC proof-of-work mining GEIS — whether the final GEIS or post-moratorium permitting guidance changes the practical constraints on fossil-fuel generation for data center loads.
- NYSERDA DCEP availability — whether NYSERDA continues or updates the Data Center Efficiency Program beyond the 2013 fact sheet.
Sources
[1] Empire State Development, “Excelsior Jobs Program,” January 10, 2017, https://esd.ny.gov/excelsior-jobs-program (accessed January 8, 2026).
[2] New York Power Authority, “Hydropower for Economic Development,” n.d., https://www.nypa.gov/services/incentives-and-grants/economic-development (accessed January 8, 2026).
[3] New York State Energy Research and Development Authority (NYSERDA) and Consolidated Edison, “Data Center Efficiency Program (DCEP) Fact Sheet,” June 2013, https://www.nyserda.ny.gov/-/media/Project/Secure-Media/Partners/DC/fs/EES-CI-dcconed-fs-2-v1.pdf (accessed January 8, 2026).
[4] New York State Senate, “Senate Bill S6486D (2021–2022): Moratorium on Proof‑of‑Work Cryptocurrency Mining Air Permits,” 2022, https://legislation.nysenate.gov/pdf/bills/2021/S6486D (accessed January 8, 2026).
[5] New York State Department of Environmental Conservation and New York State Department of Public Service, “Draft Generic Environmental Impact Statement for Cryptocurrency Mining Operations Using Proof‑of‑Work Authentication,” May 2025, https://dec.ny.gov/sites/default/files/2025-05/cryptocurrencygeis.pdf (accessed January 8, 2026).
[6] New York State Senate, “Senate Bill S6394A (2025–2026): Sustainable Data Centers Act,” March 13, 2025, https://legislation.nysenate.gov/pdf/bills/2025/S6394A (accessed January 8, 2026).
[7] New York State Assembly, “Assembly Bill A09086A (2025–2026) Summary,” 2025, https://nyassembly.gov/leg/?bn=A09086&Actions=Y&Memo=Y&Text=Y (accessed January 8, 2026).