Key points
- New Jersey fined DataOne $1.07 million
- The order covers 62 gas generators, about 123 MW
- DataOne has 45 days to file for permits
- The order does not require an immediate shutdown
New Jersey imposed a $1.07 million penalty on DataOne for installing and operating 62 natural gas generators without state air permits at its Vineland data center. DataOne is developing the site for Nebius Group (NBIS), which uses it to supply computing capacity to Microsoft (MSFT). The state Department of Environmental Protection announced the penalty on September 22.
"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," DEP Commissioner Ed Potosnak said in the department's release.
What the order requires
The administrative order lists 62 Caterpillar G3516H engines rated at 1,982 kilowatts each, about 123 megawatts combined by our arithmetic. It cites DataOne for installing them without a preconstruction permit and running them without an operating certificate, both required under the state's Air Pollution Control Act.
"Within 45 days of receipt of this document, you must submit the required Permit and Certificate application(s) to the Bureau of Stationary Sources and obtain a Permit(s) and Certificate(s)," the order says. If DataOne doesn't submit the applications within 45 days, it "must cease installation/operation of such equipment." The order doesn't require the generators to stop running now or to be removed.
DataOne can request a hearing within 20 days of receiving the order. Without one, the order becomes final, and the penalty is due. Under the order's terms, neither requesting nor being granted a hearing pauses it. The state hasn't published the date DataOne received it.
What DataOne says
"As announced in the Spring, we are transitioning to low-emission, quiet fuel cells as part of the site's permanent power solution and have the necessary approvals in place for this solution," a DataOne spokesperson said in a statement reported by WHYY. "While we disagree with the temporary generator determination, we will apply for the air permits for the temporary generators and are in communication with the Department of Environmental Protection regarding its findings and the fuel cell transition timeline."
The fuel cells come from Bloom Energy (BE). The order covers only the 62 generators and doesn't address the fuel cells.
What it means for Nebius
We reported in August that the generators were running without permits after Floodlight and The Guardian published thermal drone footage showing at least 45 of the 62 in use. The DEP said then that it had seen them during a July 29 inspection and had not yet made a compliance determination. Gas permitting has also slowed other Bloom fuel cell projects.
Nebius hasn't filed anything with the SEC about the fine, and neither Nebius nor Microsoft has commented publicly. Before the September enforcement action, Nebius said in its August 12 shareholder letter that it had delivered all Microsoft capacity tranches due at that point. On that day's earnings call, Nebius executives said they expected no significant impact on the project's timeline from the site changes.
