Vineland AI data center hit with a $1 million fine

New Jersey has fined the developers of a data center in Vineland more than $1 million for violating clean-air laws.

State officials say DataOne, a French company that is building the Cumberland County facility, installed and operated 62 large natural-gas power generators without the required DEP permits.

“This enforcement action — by far the largest ever taken against a data center in New Jersey and possibly one of the largest such actions in the nation — sends a clear message that these facilities will not be constructed or operated with impunity in this state,” New Jersey DEP Commissioner Ed Potosnak said in a statement.

During a site inspection July 29, state DEP officials saw the generators, which had not been there during a December visit, according to the enforcement document. Operating such machines — which emit carbon dioxide, nitrogen oxides, carbon monoxide, and other pollutants — without the required permits violates the New Jersey Air Pollution Control Act.

The state’s announcement comes weeks after an investigation by Floodlight and the Guardian, in which the news outlets used thermal drone footage to show the Vineland data center was operating at least 45 of its generators without permits.

DataOne spokesperson Naomi Race said company executives “disagree with the temporary generator determination” but will apply for the needed permits. Race did not respond when asked whether the company planned to pay the fine.

DataOne may request a hearing on the matter within 20 calendar days, according to the state’s enforcement document.

As for the facility’s permanent power source, the company is “transitioning to low-emission, quiet fuel cells,” for which they “have the necessary approvals in place,” according to Race. Fuel cells generate energy through an electrochemical reaction rather than combustion, pistons, or rotating machinery.

The 2.4 million-square-foot complex is set to be South Jersey’s first hyperscale AI data center. While DataOne is the owner, operator, and builder, the Amsterdam-based Nebius Group will operate the center’s internal equipment, which will fuel Microsoft’s AI tools.

Data centers handle the cloud-storage and computing needs of the companies behind increasingly sophisticated AI tools.

» READ MORE: Human reporters explain why AI data centers are so controversial in the Philly suburbs and beyond

The Vineland facility is on South Lincoln Avenue, off State Route 55, on the site of a former industrial park. The property was sold to DataOne in a private transaction, the details of which Charles-Antoine Beyney, DataOne’s founder and chief executive officer, previously declined to disclose.

He also has not disclosed a price, saying only that the project would be privately funded. Beyney said he turned down a nearly $6.2 million loan from the city due to community pushback.

Some Vineland residents have voiced concerns about the environmental, financial, and quality-of-life impacts of having a data center in their neighborhood. Opponents also took issue with the fact that DataOne did not seek their input until the facility was already under construction.

At a contentious town hall in January, Beyney tried to assuage these concerns, telling residents they had nothing to worry about because his center would use “breakthrough” technology.

“Most of the data centers that are being built today suck, big time,” Beyney said at the meeting. “No freaking way am I am going to do what the entire industry is doing … just killing our communities and killing our lungs to make money."

The Vineland facility has been under construction for more than a year. In January, DataOne executives said they expected the project to be complete by November.

Amid the global boom in data center demand, several hyperscale facilities have been proposed in the Philadelphia region, from King of Prussia to Limerick. But few have been approved and begun construction.

» READ MORE: Developer sues Upper Merion Township over rejected King of Prussia data center proposals

The Vineland site is one of them. Once fully operational, it could be the region’s first hyperscale AI data center.

The only other local facility nearing completion is Amazon’s 2 million-square-foot data center campus in Falls Township, Bucks County. As of last month, Amazon was awaiting a decision from the Pennsylvania DEP on permit applications for hundreds of proposed backup natural gas generators.

Pennsylvania Gov. Josh Shapiro shifted his stance on data centers last month and instituted new restrictions, which included the removal of Amazon from the state’s fast-track permitting process.

» READ MORE: Josh Shapiro’s not an AI ‘doomer,’ but the Pa. governor wants federal regulations for the industry

Shapiro joined New Jersey Gov. Mikie Sherrill, who in May unveiled a four-prong plan to “hold data centers accountable.” She also has signed legislation requiring data centers to provide their own clean energy and report their energy and water use to the state twice a year.

Neither governor has issued a statewide moratorium, a move for which some data-center opponents are advocating.

In recent weeks, the debate over AI has reached a fever pitch, with executives at some of the country’s largest AI companies urging a slowdown amid fears that the technology may eventually destroy humanity.