Sherrill acts on data centers. Critics want more.

A new reporting law drew praise from some environmentalists and calls for a statewide moratorium from others.

Gov. Mikie Sherrill signed a law Thursday requiring New Jersey data centers to disclose how much water and electricity they use. While the move was praised by some environmental groups, others said it does not go far enough and called on the state to halt new projects until stronger protections are in place.

The law requires data center owners and operators to report their energy and water use to the state Board of Public Utilities every six months. The reports must include total electricity consumption, energy used for cooling and information technology equipment, peak daily water use, water sources, and on-site and backup power supplies.

The measure is part of a broader package Sherrill announced in May aimed at regulating data centers and limiting their effects on utility customers and communities. The bill signing took place a few miles from a proposed data center in South Brunswick. Neighboring East Brunswick and North Brunswick recently approved bans on the facilities, they said.

Activists gathered outside the South Brunswick Library, where Sherrill signed the bill, to demand a statewide moratorium on new data centers.

“Simply reporting big tech’s rampant energy and water consumption will not protect New Jersey residents from the myriad harms caused by data centers,” said Matt Smith, New Jersey state director of Food & Water Watch. “Governor Sherrill must prioritize the needs of the public, take real action, and enact a statewide moratorium on all hyperscale data centers harming communities with high electric bills, noise and water pollution, and sprawl.”

A Fairleigh Dickinson University poll released in April found that 65% of New Jersey residents support a temporary moratorium on data center construction. New York recently enacted a temporary one-year statewide moratorium on new large-scale data centers, and several other states are considering making a similar move.

According to Climate Revolution Action Network New Jersey, at least 38 municipalities have voted to block new data centers over the past year, and more than 1 million New Jersey residents now live in communities that have banned them.

“Communities all over the state are taking matters into their own hands and banning data centers at the local level, but that’s not sustainable,” said Ben Dziobek, the group’s executive director. “These facilities are popping up everywhere, and we shouldn’t be leaving every town to fight them alone.”

But Sherrill’s approach has been to create rules for data centers while giving municipalities resources to deal with them.

“At the beginning of this summer, I announced the most comprehensive data center plan in the nation to establish strong guardrails and hold data centers accountable,” Sherrill said in a statement. “Just three months later, I am delivering on all four pillars of that plan — taking action so that towns across New Jersey know we have their backs.”

In July, Sherrill signed another law creating a separate utility rate class for data centers and requiring them to bring new clean energy onto the grid. The changes are intended to prevent other utility customers from paying for the infrastructure needed to meet data centers’ electricity demands.

Sherrill said her plan gives municipalities resources to negotiate with developers regarding proposed projects. The guidance is intended to give towns more leverage to address effects on infrastructure and public services and seek public investments from developers.

Those agreements can address local infrastructure and emergency response needs and help municipalities seek investments in public infrastructure, schools and workforce development programs. State agencies will also offer municipalities technical assistance on proposed projects.

South Brunswick Mayor Charlie Carley endorsed the approach.

“Today, we are putting power back in the hands of communities and giving places like South Brunswick a real say in what comes next,” Carley said.

Leaders of some environmental groups praised the reporting requirement and showed up at the bill signing, posing for photos with Sherrill.

“You can’t manage what you don’t measure,” Allison McLeod, interim executive director of New Jersey League of Conservation Voters, said. “This legislation gives us the transparency we need to understand energy and water usage, and to hold large load users accountable.”

Anjuli Ramos, state director of the New Jersey Chapter of the Sierra Club, also called the reporting requirement “a significant step in the right direction” that would help the state understand the strain data centers can place on the electric grid and water supply.

But Dziobek said the law allows data center operators to submit their own figures without an independent audit, sets no limits on how much water or electricity they can use and lacks penalties for facilities that drive up energy prices or pollute the environment.

Some of the information submitted to the state also will not be available to the public, critics said.

“The only responsible way NJ should move forward with regards to AI data centers is to put the brakes on them,” said Amy Goldsmith, New Jersey state director of Clean Water Action. “No permits should be considered until strict protective and enforceable regulations are adopted at the state level, including good government practices, like full transparency and robust public involvement from permit to operation. The NJ legislation being signed today does nothing to protect us against the clear and present danger of data centers. If anything, it just tells how much we have poisoned our water and air after the fact.”

Jaclyn Rhoads, executive director of the Pinelands Alliance, said data center reporting for energy and water use after the damage is done is “the antithesis of guardrails.”

“New Jersey is paving the way for data centers to contaminate our air and waterways while leaving the public to suffer. We demand more of our government officials. Pass a moratorium now,” Rhoads said.

Opponents say dealing with data center proposals town by town is not sustainable. Dziobek said the state should stop new projects until stricter rules are developed.

“We already know that data centers are driving up our electric bills and wasting our drinking water. Asking these companies to report their own numbers doesn’t help. This totally misses the moment,” he said. “Young people are looking for more than toothless legislation on an issue that’s going to radically change our lives for the worse.”