Assemblyman Dave Bailey, Jr.’s legislation designed to ensure that public utility customers are not burdened with subsidizing the energy costs of large load data centers passed the New Jersey General Assembly on Monday. Assembly members Joe Danielsen, Clinton Calabrese and Eliana Pintor Marin also sponsored Bill A796.
“Data center growth will drive up the cost of electricity if we don’t create guardrails,” said Assemblyman Bailey (D-Gloucester, Salem, Cumberland). “We want to make sure data centers pay for the energy they use and the infrastructure they need, not our constituents. This bill is about protecting ratepayers while supporting responsible economic growth.”
Bill A796 would require electric utilities to develop and apply special rules for large load data centers to protect non-large load data center customers from increased transmission and distribution costs. The bill would further authorize the New Jersey Board of Public Utilities (NJBPU) to require financial guarantees to ensure that large-load data center customers pay for at least 85 percent of the service they request for a minimum of 10 years. It would also incentivize data centers to develop and utilize methods to increase energy efficiency. The legislation would apply to data centers with a peak electricity demand of 100 megawatts (MW) or more.
“Ratepayers continue to feel the strain as more and more large load customers come online to accommodate the growing dependence on artificial intelligence,” said Assemblyman Danielsen (D-Middlesex, Somerset). “We cannot, must not, allow ratepayers to shoulder the cost of this innovation. New Jersey can welcome innovation without shifting costs onto existing customers and this bill can help.”
“Technology – and our reliance on it – continues to grow, but that growth cannot come at the expense of New Jersey families and small businesses,” said Assemblyman Calabrese (D-Bergen, Passaic). “This legislation would ensure that large-scale data centers contribute their fair share so we can support innovation while protecting ratepayers from unnecessary costs. This is about planning responsibly for the future and ensuring our grid remains reliable and affordable.”
“Rising energy costs touch every part of daily life, from our schools to local restaurants to our grandparents’ kitchens,” said Assemblywoman Pintor Marin (D-Essex, Hudson). “The last thing New Jersey families and small businesses need is to carry the added burden of powering large-scale data centers. Bill A796 ensures those costs do not fall on their shoulders, but instead require these facilities to pay their fair share. This is about protecting affordability and making sure our energy system works for the people who call New Jersey home.”