The State We're In

Feb 27, 2026

By Alison Mitchell, Executive Director, New Jersey Conservation Foundation

As tech giants race to build data centers across the nation, policymakers are struggling to manage energy affordability, and to protect the environment and local communities. In New Jersey, there are currently no clear rules requiring companies to shoulder the tremendous environmental and energy costs they impose.

These massive and sprawling digital facilities run 24/7, consuming enormous amounts of water and electricity, often rivaling small cities. As a result, load (demand for electricity consumption) is increasing faster than new resources can be added across our shared 13-state electrical grid. This growing regional shortage of new generation is driving up costs across multiple states, including in New Jersey.

More than 90 percent of new load projected by PSE&G is spurred by data centers! Virginia, which is part of our regional grid, is the world’s leading data center hub and has driven much of the load growth impacting New Jersey’s energy costs. Many more data centers are being planned and developed across the region. And there isn’t enough thought going into where they are located or the damage they bring.

Policies to shield consumers are emerging, and many states are adopting rules — including special tariffs for very large loads. One approach requires corporations to develop their own energy generation either onsite, near a data center, or feeding into the regional grid. Some states require that new load to be served partly or entirely by renewables, nuclear, or other carbon free sources.

But New Jersey has not yet advanced such policies, and corporations are taking advantage. Large data centers can bring millions in tax revenue and a surge of construction jobs – but short-term gains come with short, and long-term, pain. A hyperscale data center has opened in Vineland, New Jersey, developed by DataOne and operated by Microsoft to power AI systems. It’s designed to expand and potentially reach 300 megawatts, which would be nearly double the total amount of power used by the city right now!

While firms like Google and Microsoft have invested in renewables and even nuclear generation to limit greenhouse gas emissions and pollutants in other places, there are no such plans for Vineland. DataOne is promising to produce an estimated 85 percent of its electricity on-site using gas turbines, in addition to hundreds of diesel generators. It’s akin to a new, medium-sized gas plant and will add substantial new greenhouse gas emissions, clearly undermining New Jersey climate policies. New Jersey Department of Environmental Protection has a regulation in place to control emissions from gas plants, but questions remain whether DataOne’s center is a regulated plant that will have to meet those standards.

Data centers run hot, and those designed to cool with water require massive amounts. Cooling with air requires even more electricity. Noise, an often-overlooked pollutant, disturbs residential areas and threatens wildlife, including sensitive species like barred owls and Pine Barrens tree frogs.

Without policies that safeguard natural and built communities, we risk repeating the mistakes of the warehouse boom, where rapid development outpaced planning, leaving communities and ecosystems to bear the costs of growth.

New Jersey needs clear, enforceable policies that guide the location of data centers, regulate environmental impacts and require developers to provide their own carbon-free energy to meet their electricity demands. This would shift costs from the public to the responsible parties reaping the profits, protecting ratepayers while advancing state climate goals and preserving clean water, air, and wildlife.

Senator Bob Smith has proposed a bill to require data centers to submit a plan showing that all their electricity will come from new clean energy sources. We need more of that kind of thinking, and we need action by other legislators and the governor.

When people stay informed about local zoning and redevelopment decisions and get engaged early, they can avoid being in the shadow of a data center. Recently, in New Brunswick, swift public backlash halted a data center project practically before it began.

We have a choice: allow unchecked expansion that burdens ratepayers and the environment or establish rules for data centers that protect our environment, keep energy affordable, and support the state’s climate goals. It’s time to act!

To learn about preserving New Jersey’s land and natural resources, visit the New Jersey Conservation Foundation website at www.njconservation.org or contact me at info@njconservation.org.