Pennsylvania leaders weigh in on Shapiro’s order to control data center growth

Industry and governmental leaders are reacting to new regulations for data centers in the state with some showing concern, others support and even others speculating if it goes far enough.  

Pennsylvania Gov. Josh Shapiro signed an executive order Aug. 18 aimed at controlling the growth of data centers. 

The Governor’s Responsible Infrastructure Development (GRID) Requirements were written to block what he called speculative, irresponsible data center projects from moving forward. 

Under the executive order, developers will be required to provide a notice of intent to comply with GRID. 

They will be required to present their detailed plans to DEP, who will scrutinize them to ensure they’re sufficient. 

Developers must also sign a legally binding consent order, locking them into the GRID Requirements and setting penalties if they fail to comply. 

Requirements include developers being required to bring their own power and pay for all the costs associated with that electricity.  

They must also get an increasingly significant portion of that power from clean energy sources like solar, advanced nuclear, and battery storage. 

They also need to earn legal approval at the local level. 

“If the local community doesn’t approve a project, the state won’t approve it either,” Shapiro said. 

If a developer refuses to comply with those requirements, Shapiro said they will not be able to obtain the necessary approvals needed to build a data center in the state and they will be disqualified from receiving the existing exemption on sales tax on data center equipment. 

The state is also removing all data centers from the Fast Track permitting program. 

Dan Diorio, executive vice president of state policy and government affairs for the Data Center Coalition, said his organization does support much of the order’s intent. 

“We share Gov. Shapiro’s goals on ensuring that Pennsylvania can capture the significant economic opportunities presented by data center development while protecting the interests of residents and communities across the Commonwealth,” Diorio said in a release. “In distinguishing speculative proposals from real projects, it’s important that rules are not changed midstream, impacting ongoing investment in verified and responsible data center projects. Companies have made plans, communities have prepared for economic opportunities, and workers are ready to build the next generation of digital infrastructure right here in Pennsylvania.” 

He also spoke about the benefits of such development. 

“Data centers provide significant benefits where they operate. In Pennsylvania in 2024, the data center industry supported 129,600 jobs, contributed $19.6 billion in GDP, and generated $1.9 billion in state and local taxes – supporting tax relief, education, public safety, and helping make life more affordable for residents across the commonwealth,” Diorio said. 

State legislators also weighed in. 

State Senator Tracy Pennycuick, R-24, issued a release detailing her support and concerns for the order. 

“While the Governor’s announcement set up new hurdles for accessing the state’s current data center sales and use tax exemption, I strongly disagree with the exemption being kept available simply because tech companies or developers meet these basic responsibilities. Following the rules and acting responsibly should be the price of doing business, not grounds for a special tax break,” Pennycuick said. “Small businesses across Pennsylvania meet their obligations and invest in their communities every day without receiving this kind of preferential treatment. Data centers should not be treated differently. 

Meanwhile, State Rep. Dave Madsen, D-Dauphin, praised the order which he said establishes the nation’s strictest guardrails on data center development. 

“Pennsylvanians have been clear: they will not be steamrolled by billion dollar developers or left to shoulder the costs of massive energy demands,” Madsen said. “This executive order recognizes those concerns and ensures that transparency, environmental protection, and community input are not optional — they are the price of doing business here,” Madsen said. “Standing up for ratepayers and protecting our constitutional right to clean air and pure water is essential to public trust and responsible growth.” 

Advocacy groups have also weighed in on the order. 

The Better Path Coalition issued a statement that said it doesn’t feel the order goes far enough. 

“Pennsylvanians are demanding a statewide moratorium on data center development, not a set of initiatives that create a pathway for it. Although the standards Governor Shapiro announced today are stronger than those he has promoted to date, they do not provide the protection Pennsylvania’s communities deserve,” the organization said. “A statewide moratorium of at least three years would give the state a chance to study the health, safety, environmental, and climate impacts of data centers that are not known today. It would give the state a chance to determine if any data centers should have a place here. Anything less falls short of adequately protecting Pennsylvanians.” 

Molly Parzen, executive director of Conservation Voters of Pennsylvania, said in a release that her organization stood with the governor on the issue. 

“Our commonwealth’s affordability crisis is being exacerbated by the rapid surge in data center development, which also threatens our clean air, our pure water and our open space. This Executive Order is a meaningful step forward that will help expand clean energy generation and put safeguards in place to protect local communities,” she said. 

Data center developers and big tech titans cannot be allowed to rake in record profits at the expense of our energy bills, our clean air or our water.”