Gov. Mikie Sherrill says she’ll work with legislators to regulate data centers as backlash against the AI-driven development boom widens in New Jersey and around the country.

The governor told Gothamist Tuesday her administration is working with the Legislature to get a bill that would require data centers to “bring [their] own energy and invest in the grid” over the line. She said she is also throwing her support behind a second piece of legislation that would mandate data centers report energy and water usage to the state.

“Most people don't even know what a data center does. We have about 80 of them here in New Jersey, and I think very few people understand what they're doing,” Sherrill said. “So we're driving innovation, but at the same time, what people do know is that in too many cases, they've negatively impacted New Jerseyans.”

Administration officials told Gothamist that the details of the bill are still being negotiated but changes could come as soon as Thursday. As currently written, the bill requires guarantees that the biggest users of energy, using 100 megawatts or more, pay for 85% at least of their requested electricity for a minimum of 10 years — limiting how much is passed on to ratepayers.

Sherrill’s announcement comes as New Jerseyans continue to feel the pain of the largest electricity bill hikes in the country this past year.

She said she is also directing the state’s Department of Community Affairs to develop guidelines for companies to invest in communities where their data centers are developed. The governor said the state will  ”help towns negotiate these community benefits.”

”Think a new softball field, a new community center, or help with computing power in schools to help train AI into the curriculum,” she said.

State lawmakers across the country are moving forward with legislation to regulate data centers. In red states and blue states alike, local officials and concerned citizen groups are asking whether projects are overwhelming already strained and aging electrical grids, while driving up costs for local residents.

In Maine, the state Legislature approved a bill that would have placed a moratorium on large data centers until regulators conducted a grid-impact study. However, Democratic Gov. Janet Mills vetoed the bill after lawmakers refused to exempt a data center project already in motion at the site of a former mill in the central part of the state. In states like New York, Oklahoma, Vermont and North Carolina, lawmakers have introduced bills aimed at protecting ratepayers from covering the cost of service hikes due to the large power needs of data centers.

In New Jersey, a backlash against data centers has expanded as communities across the Garden State push back on the possibility of large projects being built in their backyards. Tensions boiled over at an Andover town council meeting earlier this month, with police forcibly removing a speaker who railed against the town’s plan to approve a data center in the rural Sussex County town. Last week, officials in the South Jersey town of Millville unanimously approved an ordinance banning data centers within their borders. The vote came before any official proposal had been made for a project in the Cumberland County town.

In the South Jersey town of Vineland, the future of the Data One data center has become a central topic in the race for New Jersey’s 2nd Congressional District. Local backlash against the $17 million data center has been fierce, and Democrats vying to challenge Rep. Jeff Van Drew are calling for a federal moratorium on data centers while their energy and environmental impacts can be studied.

In 2025, monthly utility bills rose 16.9% in New Jersey — an average annual increase of $260 per household, according to a March report released by Democrats on the Congressional Joint Economic Committee. Nationally, the average increase was 6.4%, or $110 per month.

While a number of factors — including a particularly hot summer in New Jersey last year — contributed to the spike in bills, many energy-industry experts agree that the capacity needed to power data centers played a major role in the increase in consumer costs.

Sherrill made addressing high electricity bills the centerpiece of her successful gubernatorial election campaign in 2025. She campaigned on “freezing” electricity rates on her first day in office. On Jan. 20, during her inauguration, Sherrill signed her first executive order as she was being sworn into office that made good on this promise. The order instructed the state’s Board of Public Utilities to pause any rate increase requests from utility companies. So far, the Board has followed the governor’s request this year.