Gov. Sherrill unveils statewide plan to regulate data centers, address energy demand
TRENTON, N.J. — Gov. Mikie Sherrill on Wednesday announced a comprehensive statewide plan aimed at addressing the growing impact of data centers on energy demand, infrastructure and local communities while positioning New Jersey as a leader in artificial intelligence innovation.
The proposal establishes new guardrails for data centers, including requirements tied to energy use, community impact, transparency and workforce standards as demand for AI-related infrastructure continues to rise nationwide.
“Data centers are among the biggest drivers of energy costs, which I am working tirelessly to bring down. While many states are approaching this issue piecemeal, this is the first comprehensive plan to tackle it holistically. At the same time, New Jersey will take a thoughtful approach to harnessing investment, lowering costs for ratepayers, and leading on AI innovation,” said Governor Sherrill. “By establishing these guardrails, we will hold data centers accountable, ensure they contribute their fair share, and make sure our communities not only benefit from the AI innovation happening in our state, but have a real hand in shaping it.”
According to the governor’s office, the plan focuses on four major priorities.
The first would establish “fair-share” requirements intended to ensure data centers contribute to grid infrastructure improvements and bring new clean energy generation online instead of shifting energy costs onto residents and utility customers.
The second pillar would increase transparency by requiring reporting on energy and water consumption so residents and local officials can better understand the impact of large-scale facilities.
The plan would also create statewide standards for Community Benefits Agreements while providing municipalities with state resources to negotiate with developers regarding impacts such as noise, lighting and pollution, as well as investments benefiting local communities.
Finally, the administration said the proposal would prioritize good-paying jobs by requiring data centers to utilize local trade workers and pay prevailing wages.
Officials said the initiative is part of the administration’s broader affordability and energy strategy focused on lowering utility costs while expanding energy generation capacity across New Jersey.
The governor’s office noted that recent actions have included approving six large-scale solar and battery storage projects, expanding community solar initiatives and signing legislation accelerating battery storage deployment while lifting New Jersey’s decades-old moratorium on new nuclear energy projects.
