Now available: This Is Server CountryGet the book→
NJ — State Policy Updated January 2026

New Jersey

Statewide incentives and constraints, plus active policy proposals affecting data centers and related large-load activity.

Next New Jersey Program - AI Green Building Standards Requirement Proposed Large-Load Data Center Tariff Proposed Water and Energy Usage Reporting Proposed Renewable/Nuclear Supply Requirement Proposed NDA Ban for Data Center Approvals Utility Regulation Water Constraints

Overview

New Jersey offers a substantial tax credit program for large AI data centers—up to $250 million per project—but the state legislature is simultaneously pursuing several bills that would impose new tariff, reporting, and renewable energy requirements on facilities drawing 100 MW or more.[1][4][5][6] The policy landscape is in flux: companies planning projects in New Jersey face both generous incentives and potentially strict operational conditions depending on which bills advance. Local approvals may also face new transparency requirements that would ban non-disclosure agreements.

Incentives

Next New Jersey Program - AI

The Next NJ Program - AI provides state tax credits for eligible AI businesses, including large-scale AI data centers.[1] Awards are capped at the lesser of 0.1% of capital investment multiplied by new jobs, 25% of capital investment, or $250 million.[1]

  • Eligibility thresholds: 100 new full-time jobs in New Jersey, $100 million minimum capital investment, and wages at 120% of county median salary.[1]
  • Applicants must document a collaborative relationship with a New Jersey-based university, startup, incubator, or accelerator.[1]
  • Tax credits are transferable and disbursed over five years.[1]
  • Authorized under the Next New Jersey Program Act (P.L. 2024, c.49).[2]

Green Building Standards Requirement

NJEDA incentive programs—including Next NJ, Emerge, Aspire, and CAFE—require applicants to certify that projects were designed and built to green building standards.[3] Compliance is reviewed during the application process.[3]

Requirements and Conditions

Proposed Large-Load Data Center Tariff

Assembly Bill 5462 (with committee amendments) would require each electric public utility to file a tariff for large-load data centers, defined as facilities with a maximum monthly demand of at least 100 MW.[4]

  • The tariff must protect non-data-center ratepayers from cost increases and incentivize energy-efficiency and heat-reuse methods.[4]
  • The Board of Public Utilities (BPU) may require financial guarantees that a new large-load data center will take at least 85% of requested service for 10 years.[4]

Proposed Water and Energy Usage Reporting

Senate Bill 4293 (2R) would require data center owners or operators to submit quarterly reports to the BPU covering energy and water data, emissions, and performance indicators such as power usage effectiveness and renewable energy factor.[5]

Proposed Renewable/Nuclear Supply Requirement

Senate Bill 4143 (1R) would require electricity supplied to AI data centers and cryptocurrency mining facilities to be derived from new Class I renewables or newly constructed nuclear power—once the BPU finds that a majority of PJM states have adopted similar requirements.[6]

  • The bill also mandates an energy usage plan addressing efficiency, water use, and heat reuse before local development approval, and BPU approval before grid interconnection.[6]

Proposed NDA Ban for Data Center Approvals

Assembly Bill 6181 would prohibit applicants for data center development approvals under the Municipal Land Use Law from entering non-disclosure agreements with approving authorities or municipal agencies that would conceal project details or limit public review.[7]

What to Watch

  • 2026 session status for A5462, S4293, S4143, and A6181—track committee action, amendments, or enactment.
  • NJEDA updates to Next NJ Program - AI rules or green building guidance after 2025.

Sources

[1] New Jersey Economic Development Authority, “Next New Jersey Program - AI,” n.d., https://www.njeda.gov/nextnjai/ (accessed January 8, 2026).

[2] New Jersey Economic Development Authority, “Next New Jersey Program Act, P.L. 2024, c.49” (program rules link), April 2025, https://www.njeda.gov/wp-content/uploads/2025/04/NEXT-NJ-AI-DATA-CENTER-RULES-OAL-FILED-3.27.2025.pdf (accessed January 8, 2026).

[3] New Jersey Economic Development Authority, “Green Building Standards: NJEDA Guidance for Projects Requiring Green Building Compliance (Updated March 2025),” March 2025, https://www.njeda.gov/wp-content/uploads/2025/09/Green_Building_Guidance_v9-FINAL-1.pdf (accessed January 8, 2026).

[4] New Jersey Legislature, “Assembly Telecommunications and Utilities Committee Statement to Assembly Bill No. 5462 (with committee amendments),” June 12, 2025, https://pub.njleg.state.nj.us/Bills/2024/A5500/5462_S1.PDF (accessed January 8, 2026).

[5] New Jersey Legislature, “Senate Bill No. 4293 [2R],” June 30, 2025, https://pub.njleg.state.nj.us/Bills/2024/S4500/4293_R2.PDF (accessed January 8, 2026).

[6] New Jersey Legislature, “Senate Bill No. 4143 [1R],” February 20, 2025, https://pub.njleg.state.nj.us/Bills/2024/S4500/4143_R1.HTM (accessed January 8, 2026).

[7] New Jersey Legislature, “Assembly Bill No. 6181,” December 8, 2025, https://pub.njleg.state.nj.us/Bills/2024/A6500/6181_I1.PDF (accessed January 8, 2026).