The Effect of Data Centers on NJ Taxpayers

The bottom line: New Jersey households saw electric bills spike as much as 20% starting in June 2025 [7] [9] — and data centers, not you, are the biggest reason why. Lacey families deserve honest answers about who’s paying for this build-out, and Trenton needs to act before the next auction hits.

What’s really happening

New Jersey shares its power grid with 12 other states through PJM Interconnection. Every year, PJM holds an auction to lock in power for peak demand — and as AI data centers have flooded the region, that auction price has exploded, from under $29 per megawatt-day to over $269, then to $329 the following year, hitting the legal price cap. [13] [15] That cost gets passed straight through to your monthly bill.

A New Jersey Policy Perspective investigation found data centers were the main driver of the 20% bill spike New Jersey families absorbed in June 2025 — and projects that by 2030, nearly 1 in 10 kilowatts used statewide will go to data centers, the equivalent of powering the entire state of Rhode Island. [9]

“New Jersey families are getting hit twice.” — Alex Ambrose, Senior Policy Analyst, New Jersey Policy Perspective

The environmental toll close to home

The cost of this build-out isn’t just on your electric bill. Data centers draw huge volumes of water for cooling, run 24/7 backup generators, and operate industrial-scale HVAC systems that don’t stop at night — and New Jersey communities near proposed sites are already raising concerns. [1]

Water

Cooling systems often rely on chemical additives — anti-corrosion agents, biocides, glycols, and in some cases PFAS (“forever chemicals”) that are difficult to remove. Leaks, spills, or improper disposal can carry these into soil and groundwater. [4] A separate risk comes from backup diesel generators, which typically use underground fuel tanks — a well-documented source of groundwater contamination. [2] Heavy pumping for cooling can also draw down local water tables, a real concern in a state where several counties already face drought restrictions. [4]

Noise

Data centers run large cooling fans, chillers, and backup generators around the clock. Residents near existing facilities in other states have filed complaints and lawsuits over the constant low-frequency hum, which can carry for miles and disrupt sleep and quality of life in neighboring homes. [1]

Land & air

A single hyperscale campus can consume hundreds of acres, often carved out of open space or farmland, and comes bundled with diesel backup generators that add localized air emissions during testing and outages.

Where Lacey Democrats stand

• We support ratepayer-protection tariffs that require utilities to bill large-load data centers (100+ megawatts) separately, so regular households stop subsidizing their power demand.
• We call for full transparency on grid infrastructure costs — new wires, transformers, and substations built to serve data centers should be paid for by data centers, not by Lacey families.
• We support Gov. Sherrill’s bill credits to offset the June rate hikes, and we’ll keep pushing Trenton to make relief permanent, not one-time.
• We’re demanding accountability on the “Next New Jersey” tax credit program — $500 million in incentives to attract data centers is hard to justify while residents pay more for less reliable power.
• We support independent environmental review — water-quality testing, noise-impact studies, and siting standards — for any proposed data center in or near Ocean County, before ground is broken.

The Trenton fight

Bills are moving through the Legislature right now that would force utilities to design special data-center tariffs and stop shifting stranded infrastructure costs onto regular ratepayers. [10] [11] [12] They deserve our support.