New Jersey Governor Phil Murphy on July 9 signed into law legislation that will help determine the impact data centers have on electric usage and consumer costs.
The law directs the New Jersey Board of Public Utilities to conduct a study on the effects these centers have on utility use and ratepayer expenses.
The legislation -- S-4318/A-5466 – was sponsored by New Jersey State Senators John Burzichelli and Linda Greenstein.
“The high-tech data centers that are proliferating throughout the state consume a large amount of electrical power at a time when energy costs are increasing for ratepayers,” said Burzichelli (D-Gloucester/Salem/ Cumberland). “We need to know if their impact on the energy supply is causing rate increases for everyday consumers. This information will help protect residential ratepayers from being forced to subsidize high-profit data centers.”
According to the law, the BPU’s study will determine if ratepayers are incurring unreasonable increases to support the transmission, distribution or generation of power for the data centers and calculate the portion of rates attributable to the demands of these facilities.
“New Jersey is experiencing its own expansion in data centers with the growth of AI-focused computer companies,” said Greenstein (D-Middlesex/Mercer). “This concentrated growth has implications for the regional grid, including an impact on the supply of energy and consumer costs. We need to make sure these centers are paying their fair share and that the costs aren’t falling on non-data center customers.”
The study will assess the need for special “tariffs” applied to the centers to compensate for costs they impose on other PJM customers.
The study will also look at longer-term considerations to see if investments in the power infrastructure will be needed to accommodate the demands of the data centers.
The results of the study will be submitted to the Legislature and the Governor within 15 months, according to the law.
