Gov. Sherrill lays out plan to ease AI data centers' burden on NJ towns, electric bills

New Jersey Governor Mikie Sherrill revealed a comprehensive plan to regulate data centers amidst growing public concern over their energy demands and impact on utility costs across the state. The first-term governor, who campaigned on freezing electricity rates, is collaborating with the state Legislature on two key pieces of legislation.

One proposed bill would require data centers consuming 100 megawatts or more to guarantee payment for at least 85% of their requested electricity for a minimum of 10 years, aiming to reduce the burden on ratepayers. A second bill would mandate that data centers report their energy and water usage to the state. Additionally, Governor Sherrill is directing the Department of Community Affairs to establish guidelines for data center companies to invest in communities where they operate, offering benefits such as new community centers or educational computing resources.

This statewide initiative follows significant electricity bill hikes in New Jersey, the largest in the nation last year, partly attributed to data center energy needs. Local opposition has intensified, exemplified by an Andover town council meeting where police removed a protesting speaker, and Millville’s unanimous approval of an ordinance banning data centers within its borders. Democrats challenging Rep. Jeff Van Drew are also advocating for a federal moratorium on data centers to study their environmental and energy impacts. While a similar moratorium bill was vetoed in Maine, New Jersey's legislative efforts are progressing, with details expected soon.