New York town finds moratorium can't stop data center project

A massive data center planned for Massena is moving toward construction despite New York’s one-year moratorium on new data center development, with town officials saying the project is exempt and the town council rejecting a separate local pause.

The state has not yet determined whether the project falls under Gov. Kathy Hochul’s executive order. But New York Digital Investment Group, or NYDIG, plans to begin building the 870,000-square-foot facility at a former aluminum smelting site in late 2026.

"They’re exempt from the governor’s moratorium,’’ said the town supervisor, Ray Lancto.

At full buildout, the proposed 635-megawatt facility would consume more than three times the electricity needed to serve the roughly 170,000 households in the six counties of Northern New York. If operating today, it would be the state’s largest data center.

State review remains unresolved

Hochul signed the one-year moratorium in July. Her executive order directs the Department of Environmental Conservation to "hold in abeyance all applications for any discretionary permit, approval, license or similar form of permission" to build a data center of 50 megawatts or more.

Massena officials say NYDIG’s project does not need new permits from the DEC and therefore would not be affected.

State officials have not confirmed that interpretation for NYDIG or any other specific project. Kristin Devoe, a Hochul spokeswoman, said the DEC is reviewing proposed developments.

"Currently DEC is evaluating projects to see if they would be captured by the EO,’’ she wrote in a text message.

NYDIG officials did not answer specific questions, instead referring a reporter to the project website, which lists a late 2026 construction start.

The five-member Massena town council also considered a six-month local moratorium. Earlier this month, members voted it down, 3-2.

Power demand fuels opposition

For opponents, the project’s electricity needs are a central concern. Critics worry that increased demand could raise regional electric prices.

"We’re a poverty area. We can’t afford prices to go up,’’ said David Fenton, who organized a petition seeking a three-year moratorium on data centers.

Fenton said about 500 registered voters in the town signed that petition. A separate petition circulated by Mohawks United in Safety and Health to prohibit new data centers collected about 800 signatures.

Advocates also wanted a pause to allow town officials to examine potential noise pollution, water usage, heat output and other impacts.

The NYDIG project is among several developments seeking access to St. Lawrence County’s transmission network, built to carry electricity from the St. Lawrence-FDR hydropower plant. The plant produces about 850 megawatts.

The New York Independent System Operator, which oversees the transmission grid, is reviewing 10 other interconnection requests in the county. If approved, those projects would consume 5,200 megawatts, enough electricity for more than 5 million homes.

NYDIG already has a head start. It acquired North Country Colocation Services, which has operated cryptocurrency mining in the former "Alcoa East" aluminum smelter since 2017. NCCS sought a 435 MW grid connection in 2020 and has received NYISO approval to build it. An additional 200 MW connection requested by NYDIG last year is awaiting study.

Jobs and revenue draw support

Massena, a rural town of about 12,000 people on the St. Lawrence River, has a long industrial history but has lost major employers. General Motors left in 2009, and Alcoa closed the former Reynolds smelter in 2014. Alcoa continues operating a separate smelter in Massena.

Some residents and town officials support the data center because of NYDIG’s promises of jobs and revenue. The company estimates the project would create 2,000 construction jobs and 200 permanent jobs.

NYDIG says the facility would become Massena’s largest taxpayer and lower taxes for the average household by $1,300 a year. The company did not answer questions about how it calculated that estimate.

James Hidy, a former village mayor of Massena, urged the town council during a public comment session in August to embrace the revenue opportunity.

"You’re living in a dying community,’’ Hidy told the town council, according to local news reports and an online video. "You have no revenue coming in here."

According to meeting minutes, NYDIG says it will sign a host community agreement providing a $7 million payment when the first data hall connects to the grid and another $3 million when the entire campus is energized. Depending on the contract’s structure, the company could then pay $3 million a year for up to 30 years.

Environmental scrutiny continues

NYDIG, owned by Stone Ridge Asset Management, plans to acquire 1,375 acres at the Alcoa East site for two new data center buildings and a massive substation. The smelter itself, a Superfund site, would remain Alcoa Corp.’s property.

The company currently employs about 60 people at the site and is shifting from cryptocurrency mining toward high performance computing that supports artificial intelligence.

NYDIG has agreed to provide $250,000 for the town planning board to hire consultants to review potential environmental impacts. Lancto said the town is selecting those consultants.

The site lies about eight miles east of the village of Massena and about a mile from the Akwesasne territory, home to the St. Regis Mohawk Tribe, according to Ronni Sunday, a member of Mohawks United in Safety and Health.

Sunday worries that the project’s size could bring noise and vibration affecting local health in an area already polluted by industrial contaminants such as PCBs. Her group intends to keep pressing town officials to limit the project’s impacts.

"We just learned that the (state) moratorium doesn’t apply to them,’’ she said. "And the (town) moratorium that we were looking for at a local level did get denied -- they did reject it. And so there’s nothing really stopping the expansion at this point, aside from the zoning laws."

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