Members of the Assembly Telecommunications and Utilities Committee:
I am writing on behalf of the New Jersey Business & Industry Association to express our opposition to A5462 which would set special tariffs for data centers. The intent of the tariff is to protect ratepayers from increased electricity costs and to incentivize efficiency. We believe the effect of the bill will do neither but will, in fact, discourage the location of data centers in New Jersey.
We fully understand the sponsor's concerns with recent rate increases, in part due to the demand created by data centers in the PJM region. However, we believe the answer to the capacity issues is not to discourage new demand, and thus economic growth, but to encourage the development of more generation to accommodate that growth. Data centers, while admittedly potentially large energy users, are no different than other large users who do not pay special, punitive tariffs. Large manufacturers and even hospitals can use equivalent amounts of energy. Other states, like Virginia, who have more data centers than any other state, have rate incentives to encourage their growth.
It is also worth noting that the growth of data centers anywhere in the PJM region will impact the capacity market so a law in New Jersey to discourage them will only harm New Jersey's economy and not provide protection to ratepayers.
We also understand that some companies want a clear threshold of applicability so that they are not caught up in the entanglements of this legislation. While we would support these amendments to limit the scope of the bill, we believe the bill should not pass even if amended.
Finally, I want to bring to your attention the recent developments in our sister state, Pennsylvania (article pasted below). Our neighbor to the west has decided to embrace the development of data centers by ensuring it has sufficient energy capacity for their functions. They welcome this economic opportunity. As a result, Amazon is investing $20 billion in data center development in that state. One such facility is directly across the river from Trenton and can be seen as you enter the tunnel from the south. They get the economic benefit; we get to look at it as we head to Trenton.
While Pennsylvania will benefit from a massive construction and jobs project, we are considering a bill to disincentivize their location in New Jersey. Pennsylvania has also reduced its Corporate Business Tax while New Jersey increased its tax to be the highest in the nation. Is there any surprise that they are getting $20 billion in investment while New Jersey is not? New Jersey has claimed it wants to be the AI capital of the country. Passage of this legislation sends the message that we are not serious in our claims.
Thank you for your consideration and we ask that this bill not be released.
Amazon Announces $20B Pennsylvania Data Center Investment.
About Amazon (6/9) reports Amazon plans to invest at least $20 billion in Pennsylvania to expand AWS data center infrastructure, supporting AI and cloud computing. The project, targeting Salem Township and Falls Township initially, will create 1,250 high-skilled jobs and thousands more in construction and supply chains. Pennsylvania Governor Josh Shapiro called it “the largest private sector investment in the history of Pennsylvania,” emphasizing job creation and economic growth. Amazon Chief Global Affairs and Legal Officer David Zapolsky said the investment “reinforces our dedication to advancing AI innovation while creating lasting economic opportunities.” The company will also launch workforce training programs and a $250,000 community fund for STEM, sustainability, and digital skills initiatives. Amazon has already invested $26 billion in Pennsylvania since 2010, supporting over 27,000 direct jobs.
The AP (6/9) reports AWS VP of Global Data Centers Kevin Miller said the company will construct one data center complex adjacent to the Susquehanna nuclear power plant in northeastern Pennsylvania and another at the Keystone Trade Center site near Philadelphia. The Susquehanna facility will draw power directly from the plant, while the Fairless Hills location will connect to the grid. Gov. Shapiro said his administration is collaborating with Amazon on additional Pennsylvania data center projects beyond the initial $20 billion investment. The state will allocate $10 million for workforce training programs and provide sales tax exemptions on data center equipment purchases. Talen Energy sold land and an existing data center near the Susquehanna plant to Amazon for $650 million, with plans to supply up to 960 megawatts of power. However, federal regulators have delayed approval of the direct power arrangement. Microsoft has a similar agreement involving Pennsylvania’s Three Mile Island nuclear facility.
Axios (6/9, D'Onofrio, 1.26M) reports Amazon is considering multiple additional Pennsylvania sites for future data centers beyond the initial $20 billion investment, though a company spokesperson declined to disclose specific locations due to “security reasons.” The announcement follows Amazon’s recent collaboration with the University of Pittsburgh to establish the region’s first cloud innovation center. Some critics nationwide oppose data centers over aesthetic, housing, and national security concerns.
Amazon VP of Public Policy Shannon Kellogg told Fox Business (6/9, Wallace, 3.06M) the project will include “multiple data centers” across several townships, saying, “We really integrate ourselves into the communities where we invest.” He highlighted collaboration with the Trump Administration on policies to streamline data center permitting and power infrastructure, calling it “central to this global competition” in AI leadership. Kellogg said Amazon is announcing a $250,000 in-communities fund to support non-profits and will engage in workforce development programs with local institutions and reiterated the company’s “water-positive goal” by 2030, including potential upgrades to local water systems. He added, “We’re super engaged with the local communities from the beginning” to address concerns.
The Philadelphia (PA) Inquirer (6/9, Vadala) reports Falls Township Board of Supervisors Chairman Jeff Dence said the Amazon investment will “restore the former US Steel property to its heyday as a major employer” and bring “high-paying jobs” to the community. Sen. Dave McCormick called the project “just the beginning,” citing Pennsylvania’s energy resources, workforce, and research institutions as ideal for powering “America’s innovative technological future.” Gov. Shapiro framed the investment as part of a US-China AI competition, stating, “I sure as hell think those technologies should be developed by the hands of a Pennsylvania worker here in the US, not in communist China.” He emphasized Pennsylvania’s potential to lead in AI and cloud computing.
The Harrisburg (PA) Patriot-News (6/9, 567K) reports the Pennsylvania data campuses will be anchored with “high-tech cloud computing and AI innovations campuses” featuring large warehouses for data storage. The company will offer training programs, including data center technician courses and fiber optic fusion splicing workshops. Amazon also launched the $250,000 Amazon Northeastern Pennsylvania Community Fund, providing up to $10,000 grants for STEM, sustainability, digital skills, and other initiatives. While Senator McCormick praised the project, environmental groups raised concerns over energy demands. Former Department of Environmental Protection Chief John Quigley suggested data centers should implement “load flexibility” to reduce grid strain. Local municipalities like Middlesex and Swatara Townships have adjusted zoning for data centers, though residents question infrastructure capacity.
The Wilkes-Barre (PA) Citizens’ Voice (6/9, 146K) reports DCED Secretary Rick Siger said, “Pennsylvania is proud to have worked alongside our local partners in Salem Township, Luzerne County and Falls Township, Bucks County, to win today’s unprecedented $20 billion investment from Amazon. The company’s data center campuses will drive enormous positive tax impacts for our Commonwealth, counties, and municipalities, and will create at least 1,250 high-paying, high-tech jobs as well as thousands of construction jobs.” Luzerne County Community College President John Yudichak “said the college ‘stands at the ready’ to produce the necessary technology and skilled trade workers to meet the demands of a 21st-century Pennsylvania economy through its new Career & Technology Academy, its Applied Technology Programs, and a new Microcredential Academy.”
Additional coverage includes Reuters (6/9), the Pittsburgh (PA) Post-Gazette (6/9, Jad, 426K), CRN (6/9, Harris), Quartz (6/9, 158K), PYMNTS (6/9, 8K), Dow Jones Newswires (6/9, Subscription Publication), The Hill (6/9, 5.69M), Seeking Alpha (6/9, 923K), Chain Store Age (6/9, 4K), the Levittown (PA) Patch (6/9, 1.44M), Firstpost (IND) (6/9, 22K), the Times of India (6/9), CoStar Group (6/9, 24K), the Pittsburgh Business Times (6/9, 850K), DatacenterDynamics (6/9), Bucksco Today (6/9), Philly (PA) Voice (6/9, 170K), Lehigh Valley (PA) Business (6/9, Gruver), CNBC (6/9, Marks, Stankiewicz, 7.34M), Neowin (6/8, 4K), WNEP-TV Scranton, PA (6/9, 253K), WCAU-TV Philadelphia (6/9, 134K), CBS News Pittsburgh (6/9), WHYY-TV Philadelphia (6/9, 19K), WFMZ-TV Allentown, PA (6/9, Reinhard, 176K), and WPVI-TV Philadelphia (6/9, 12:27 p.m. EDT, 154K).
