Notice

Governor Shapiro Signs Data Center Executive Order

On August 18, 2026, Governor Josh Shapiro delivered remarks at a press conference before signing an executive order to implement the Governor's Responsible Infrastructure Development (GRID). The goal of the GRID Plan is to add requirements to data center development, block speculative, irresponsible data center projects from moving forward, and to give local communities more power over data center development, and protect Pennsylvania residents.

The Executive Order directs the Pennsylvania Department of Environmental Protection (DEP) to incorporate the GRID Requirements into the agency’s permit review process for all data center proposals. Developers will now be required to participate in a pre-application meeting with DEP and execute a Consent Order and Agreement (COA) that contains a legally binding commitment to follow the Governor’s GRID Requirements, and penalties for failure to follow through on those commitments. A template COA containing the Requirements is available here.

For those projects, DEP will continue to review qualifying permits as the applications are submitted and found to be compliant under Pennsylvania law. However, as a change from current practice, DEP will not issue any permit unless the project has received all required approvals from the local government who oversees the zoning of the project. Permits will incorporate the GRID Requirements as warranted.

For developers who do not agree to meet the Governor’s GRID Requirements, DEP will not begin review of permit applications until after all required local approvals are secured and every permit application required for construction of the data center has been reviewed and found to be compliant by DEP. The new permit review process will apply to all new data center permit applications going forward and will likely delay any data center development from occurring that does not meet the GRID Requirements.

In addition to the permitting changes at DEP, the Department of Revenue (DOR) will update the Computer Data Center Equipment Exemption Program Guidelines to ensure applicants for the sales and use tax exemption also comply with the GRID Requirements.

The GRID Requirements stipulate that developers must:

1. Pay the full cost of new electricity generation, transmission, distribution, and other infrastructure needed to power their project without shifting costs to Pennsylvania households and businesses;
    
2. Commit to open, transparent engagement with local residents and leaders including detailed community outreach plans that include notification to impacted local governments, public meetings, and consultation early enough in the process to allow meaningful public input on major design decisions;
    
3. Hire and train local workers and enter into meaningful community benefit agreements that invest in local priorities, from schools and infrastructure to long-term economic development; and
    
4. Meet the highest standards for environmental protection, including strict water conservation requirements.

Also included in the Executive Order were the following:

1. Data center operators will be required to submit to DEP information on energy and water consumption with measurements including total energy consumption and total natural gas consumption for the previous calendar year; estimated average amount of energy usage per hour during the data center's peak; total water consumption for the previous calendar year, along with the maximum day demand; and any measures taken to protect the environment and public from polluted water or air.
    
2. All data center proposals will be removed from the PA Permit Fast Track Program, administered by the Office of Transformation and Opportunity (OTO). Data center projects will not be considered for the PA Permit Fast Track Program in the future
    
3. DCED will release best practices for municipalities on zoning standards and community benefit agreements when engaging with data centers.
    
4. The use of nondisclosure agreements with data center projects is not permissible
    
5. DEP has created a publicly accessible map containing all proposed data center projects in Pennsylvania. On the map, residents can easily track the status of permits as they are reviewed by DEP. The map will be updated regularly as DEP becomes aware of new proposals. The map can be viewed here.
    
6. The Special Counsel for Energy Affordability, the Shapiro Administration’s energy watchdog, will engage with the Pennsylvania Public Utility Commission (PUC) to ensure data center development does not shift energy costs onto Pennsylvania households and businesses — and does not compromise the reliability of their electricity service by doing the following:

• First, the Special Counsel will support the development of protocols to ensure that, in the event the power grid is stressed, data centers lose electric service before other customers.
• Second, the Special Counsel will work with the PUC to establish procedures for electric utilities to charge data centers – and not other customers – for the costs of “reliability backstop” auctions that PJM conducts to secure new power plants to meet data center demand.
• Third, the Special Counsel will support the PUC’s work to develop protocols for ensuring that data center electricity demand is accurately forecasted and transparently disclosed.

“The Executive Order sends a clear message: developers must demonstrate that a project can be developed responsibly and the community approves of the project in order to move forward,” said Governor Shapiro.

To read the Executive Order in its entirety, please click here.

For additional information on this Executive Order, please reach out to PSAB’s Government Affairs Department