Gov. Mikie Sherrill recently signed a trailblazing legislative package ensuring large-load facilities (such as AI data centers) pay for their own grid infrastructure rather than passing costs to households. The legislation requires massive data centers to finance grid upgrades, pay for at least 85 percent of requested power for 10 years, and submit public energy reports.
These new protections were enacted through three landmark energy bills.
The first is Ratepayer Protection (A796/S731), which forces data centers using 100 megawatts or more to pay for their own grid infrastructure upgrades, such as wires and substations and provide financial guarantees covering at least 85 percent of their requested electricity demand for a 10-year period.
Also, there are Clean Energy and Efficiency Requirements, which pushes large-scale operators to source their own clean energy, reduce demand during peak grid hours, and reuse waste heat.
Finally, is Resource Transparency (S3379). It Mandates that data center operators submit semi-annual water and energy usage reports to the New Jersey Board of Public Utilities, which will then be posted publicly to track the industry’s massive resource consumption.
Together, the legislation aims to protect residents from electric bill hikes as artificial intelligence and tech operations continue to expand in the region.
Assemblyman David Bailey Jr., a Democrat representing Cumberland, Gloucester and Salem counties, sponsored the bill, and he compared it to a prenuptial agreement, WHYY-TV reported.
“This is not an anti-data center bill,” Bailey said during a committee hearing earlier this spring. “We want to be married to data centers. We want them to come here. … [This bill] says, ‘You want to come here? Pay for what you say you’re going to do. … Put your money where your mouth is.”
