Three bills strip utility adders, tighten transmission oversight and force data centers to pay their own grid costs.
Three statutes were signed into law at a private home in Salem County on Tuesday morning. Governor Mikie Sherrill claims the measures will cut utility charges by over a billion dollars per year, citing an administration projection that draws on Synapse Energy Economics modeling. Her office has not released a per-bill breakdown.
The event took place at the house of Assemblyman David Bailey in Woodstown, marking the first time Sherrill has staged a bill signing at a residence; the formal work shifted indoors after the outdoor photographs. Bailey's mother, Eileen, took possession of the signing pen. Sherrill treated the occasion as the climax of a push spanning nearly six months that began with executive orders freezing rate hikes and accelerating new power generation.
Three Bills Target Pressure Points
The legislation targets three distinct pressure points on the state's power network. One measure, S1673/A2757, removes a bonus profit margin that utilities collect on transmission investments under a 2006 federal rule. The margin, known as an "adder," flows through wholesale rates and inflates customer bills.
A second measure, S4411/A5188, plugs a regulatory loophole by mandating that utilities secure New Jersey Board of Public Utilities approval before erecting extra transmission lines, substations and related equipment through a state operating permit known as a CPCN. Designs employing advanced grid hardware receive a 120-day expedited ruling; all others get a 180-day standard ruling.
The third bill, S731/A796, erects a distinct customer category for data-center load, capping the size threshold at 50 megawatts. It forces centers to cover their own transmission and distribution costs rather than passing those expenses to household and commercial accounts.
Bailey, whose district covers Cumberland, Gloucester and Salem, steered the data-center measure through the Assembly in a 55-to-18 vote on March 23 after senators revised it in May and June. The measure reaches approximately eighty facilities now drawing power in New Jersey, including some that demand 300 megawatts.
The administration's $1 billion headline folds together two separate things. Synapse Energy Economics ran its numbers in November using four policy changes, but the governor's office mixed those results with her own executive orders to produce the savings claim. The release does not break out what the three bills signed July 7 would save on their own.
The administration's own numbers, attributed to the Rocky Mountain Institute, illustrate the scale of the affordability problem. Supplemental transmission projects made up 79% of New Jersey ratepayer transmission costs from 2008 to 2025 — $14.7 billion total. The state represents 12% of demand for PJM Interconnection but nearly 22% of supplemental project spending, the biggest differential of any PJM state. Those figures have not been independently contested by utilities or regulators.
Meanwhile, the New Jersey Economic Development Authority is pulling data centers in the opposite direction. It handed CoreWeave a $250 million tax credit and steered another $79 million to ten clean-energy ventures. The New Jersey Sierra Club has said AI-driven facilities represented more than two-thirds of anticipated consumption in the most recent PJM auction.
Sherrill Casts Signing as Latest in Energy Affordability Push
Since January, Sherrill has frozen rate hikes by executive order, nominated a new utility regulator, and pressed federal regulators on electricity costs. "I made a commitment to rein in energy costs, and today we are delivering on that commitment," she said at the Woodstown signing.
The governor returned to a familiar theme. "For too long, New Jersey families have paid the price for poor oversight, outdated policies and rising demand on our electric grid by unchecked actors," she said.
Assemblyman Bailey cautioned that unregulated facility expansion would inflate monthly charges: "Data center growth will drive up the cost of electricity if we don't create guardrails."
He also kept focus on who would bear the cost. "We want to make sure data centers pay for the energy they use and the infrastructure they need, not our constituents," he added.
The New Jersey Assembly Republican Caucus tweeted a blunt critique of the signing: "Three energy bills signed today by @GovSherrillNJ. Number of megawatts of new energy production created: ZERO. 200,000 New Jerseyans lost power over July 4th weekend." The caucus linked the signing to the power outages across the state on the weekend of July 4, though the bills had not yet been signed when the storms hit.
Senator Declan O'Scanlon and three other Republicans voted against the data-center tariff. O’Scanlon argued in January that the charge would pass costs back to ratepayers through wireless service and phone bills.
NJBIA Opposed Bill, Turned Neutral After Amendments
The New Jersey Business and Industry Association dropped its opposition after Assembly amendments in February. Ray Cantor, who handles government affairs for NJBIA, told lawmakers in June 2025 that discouraging new demand would hurt economic growth. But the association had turned neutral in February.
That month, amendments to the Senate bill capped the threshold at 50 megawatts and required the board to treat any data centers under the same corporate umbrella or located on adjacent land as a single facility.
Jack Ramirez, an NJBIA policy analyst, said the February rewrite closed loopholes that would have let developers split projects into smaller parcels to evade the rules. "The amended changes help clarify the policy and better protect ratepayers while still allowing innovation and business growth to move forward," he said.
Environmental Groups, Lawmakers Praise Bills
Eric Miller, Northeast and Mid-Atlantic regional director for Evergreen Action, said the bills would restrain rate increases and subject utilities to tighter scrutiny. "When Governor Sherrill was elected, she promised to fight to lower energy costs for Garden State families. Today, she's delivering on that promise—and establishing New Jersey as the national model for tackling the affordability crisis and the climate crisis at the same time," he said.
Dawone Robinson, who manages NRDC's state operations, praised this package even as he stressed execution. "The best solutions for New Jersey involve speeding up the deployment of clean, affordable energy solutions and preventing data centers from passing costs onto consumers while ensuring they bring their own clean energy online," he cautioned. "Smart implementation will be essential to ensure people in the state reap the affordability and clean energy benefits that come from these new laws."
Assemblyman Avi Schnall, representing Monmouth and Ocean, stressed that modernizing grid equipment would lower costs while improving reliability. "I am proud to sponsor legislation that will improve critical infrastructure across the state without burdening ratepayers. By updating existing infrastructure, we increase reliability. But when we strategically deploy advanced technologies, we can reduce costs for ratepayers at the same time."
Assemblyman Cody Miller, whose district covers Atlantic, Camden and Gloucester, hailed the transmission measure for tightening the review standards for supplemental grid projects. "New Jersey's energy infrastructure faces growing demands, making modernizing New Jersey's electric grid more important than ever. Through A5188, we are establishing new review processes that will ensure that projects meet better grid performance benchmarks. At the same time, by requiring state oversight, we're making sure that investments in supplemental utility projects are necessary, cost effective and meet our energy goals."
Sherrill now faces the harder task of implementation. She still needs a confirmed regulator for the BPU, written rules for the data-center cost framework and a standalone estimate proving the three statutes alone deliver what she claims. The New Jersey Economic Development Authority is still underwriting the same industry the Board of Public Utilities now wants to bill. The signing produced photographs, but the work starts now.
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