Oregon has effectively paused new data center development. Governor Tina Kotek directed the Department of Environmental Quality to stop processing and issuing air and water discharge permits for new or expanded data center facilities until July 1, 2027, including municipal wastewater permits tied to data center discharge. The department confirmed to Datacenter Dynamics that the pause covers both new and pending applications while it works out implementation.
Kotek framed the pause as time to absorb recommendations from the state’s Data Center Advisory Committee and to prepare possible reforms for the 2027 legislative session. It follows an earlier directive pausing state land transactions for data center projects until July 2027, and her August decision to block a 32 acre land sale at the Mill Creek Corporate Center in Salem for a proposed Verrus project. The city of Hillsboro, the center of Oregon’s cluster, adopted its own 120 day moratorium at the end of July.
Industry reaction was immediate. Amazon Web Services, which has operated in Oregon for more than 15 years, called the directive abrupt and said it lacked meaningful engagement with affected workers, businesses and municipalities. Community and environmental groups welcomed it: Food and Water Watch called it a major victory, while Oregon Rural Action said a pause without legal change is not a long term solution and pressed the legislature to act during the window.
Oregon matters beyond its borders because it is one of the larger US data center markets, anchored by the Hillsboro area outside Portland. A state level permit freeze there, following New York’s local moratorium that has already complicated conversion plans elsewhere, shows the constraint set for AI capacity widening from power and chips to environmental permits and local politics.