NJBIA is urging Gov. Phil Murphy to veto legislation that raises significant concerns about business data security and privacy by mandating that operators of data centers submit quarterly energy and water use reports to the state Board of Public Utilities.
“At a time when states and nations are vying to attract data centers – and the jobs and economic activity they create – it's crucial that we maintain an environment conducive to growth and development,” NJBIA Deputy Chief Government Affairs Officer Ray Cantor wrote in a July 17 letter to the governor.
“S-4293 does not promote greater environmental awareness; instead, it mandates the public disclosure of sensitive information that could be used against businesses, potentially exposing proprietary data that companies depend on for their operations,” Cantor said. “This risk alone is enough to prompt these centers to relocate from our state or to exclude New Jersey from consideration when planning expansion.”
Cantor noted the state Department of Environmental Protection already does meticulous work to ensure no development withdraws water from any source unless there is an adequate supply. The bill “perpetuates a false narrative that this industry is extremely harmful to the environment and surrounding communities, which could not be further from the truth,” he said.
The bill also fails to consider the AI industry’s ongoing efforts to transition data centers toward renewable energy sources and advanced cooling technologies. It is in the industry’s own best interest to make sure it is using energy and water efficiently because energy and water are among its largest expenditures, Cantor pointed out.
According to an analysis published in the academic journal Science, the amount of computing done in data centers increased by 550% between 2010 and 2018, but energy consumption at the centers in the same period only grew by 6%. This analysis underscores the fact that much of the conversation surrounding data centers' energy and water consumption is often perpetuated on false or misleading information, Cantor said.
“Right now, our state remains competitive with our regional partners by being home to roughly 77 data centers,” Cantor noted. “But legislation like S-4293 risks that. This legislation sends the wrong message to our business community and unintentionally vilifies data centers and the great resources they provide.”
Cantor noted President Donald Trump recently announced that various businesses, including Amazon, are collectively investing $90 billion for the construction of data centers and their energy supplies in Pennsylvania. If S-4293 is signed into law, New Jersey will be erecting an unnecessary barrier to the growth of the AI industry in the Garden State.
