New Jersey won’t ban AI data centers — but Sherrill says residents shouldn’t pay the price for them
New Jersey Governor Mikie Sherrill announced new regulations aimed at requiring data centers to cover their own infrastructure costs, particularly for electricity, to prevent increased rates for residents. This statewide policy comes amidst growing public opposition and a recent federal lawsuit against the Data One AI data center in Vineland over nuisance claims. While a general ban on data centers was rejected, the state plans to implement "Guardrails on Data Centers" to ensure fair operation.
New Jersey Governor Mikie Sherrill unveiled a new policy initiative titled "Guardrails on Data Centers," aiming to prevent these power-hungry facilities from straining the existing electric grid and inflating costs for average ratepayers. Speaking from Trenton, Governor Sherrill, joined by Democratic lawmakers, a Republican mayor, and representatives from the New Jersey Chapter of the Sierra Club and the International Brotherhood of Electrical Workers Local 102, clarified that the state would not impose a moratorium on data center construction.
However, the Governor stressed that data centers must "pay their fair share" for necessary infrastructure upgrades. She noted that modern data centers can consume up to 300 megawatts, equivalent to powering entire towns, and this escalating demand is a factor in rising electric bills. The new policy, which requires legislative action, will mandate that data center operators contract with their own power generators and fund grid improvements to manage the increased load.
This announcement follows intense public criticism and environmental advocacy for a moratorium on data center development, including a specific instance where strong local objections "derailed a potential proposal" in Andover Township, Sussex County. Adding to the pressure, a federal lawsuit was filed just a day prior by two Vineland residents against the Data One AI data center, alleging nuisance from persistent noise due to inadequate sound-dampening measures.
Environmental groups like the Pinelands Alliance, who have pressed for a moratorium, also raised concerns beyond electricity, highlighting the "enormous amounts of electricity and water" required by hyperscale data centers. They specifically pointed to the vulnerability of South Jersey's Kirkwood-Cohansey aquifer. While Michele Siekerka, President and CEO of the New Jersey Business and Industry Association, saw the policy as a welcome sign for the industry, the Pinelands Alliance reiterated that water and other resource demands remain critical issues not fully addressed by the energy-focused "Guardrails" plan.