Healey conditions state permits for large data centers on community agreements
Massachusetts Governor Maura Healey has signed Executive Order 658, which conditions state permits for data centers exceeding 25 megawatts on community benefits agreements and adherence to a state framework. The order mandates that data centers procure their own incremental clean electricity and cover their infrastructure upgrade costs, preventing financial burdens on other ratepayers. State agencies are tasked with establishing compliance mechanisms and municipal guidance by year-end.
Massachusetts Governor Maura Healey signed Executive Order 658 on September 8, imposing significant new requirements for data centers in the state. The order dictates that facilities built or expanded after this date, exceeding 25 megawatts of peak electric demand, will only receive state permits if they demonstrate conformance with the administration's data center framework and submit a community benefits agreement with key stakeholders that meets state standards. Gov. Healey emphasized the administration's stance, stating, "Unless a community says yes to a data center, we are saying no," although the operative text provides a framework rather than a direct municipal veto.
The executive order assigns specific tasks to various state agencies. The Department of Public Utilities is directed to prioritize the completion of large load rate schedules, ensuring that data centers are solely responsible for the costs of distribution grid upgrades necessitated by their demand. Furthermore, the Department of Environmental Protection (MassDEP) must develop protocols by December 31, requiring covered facilities to procure enough incremental new clean electricity to offset their annual consumption or pay into a Ratepayer Protection Fund to lower supply costs for all ratepayers. Energy and Environmental Affairs Secretary Rebecca Tepper highlighted, "Data centers can afford to pay for their own clean energy and infrastructure, and we're going to make sure they do."
Additionally, MassDEP is tasked with establishing protocols to protect water quality and quantity, ensuring compliance with state water, wastewater, and stormwater requirements for data center projects. The order also prohibits permitting agencies from entering into non-disclosure agreements with data center projects, encourages annual reporting on facility operations, and promotes project labor agreements, local hiring, and registered apprenticeships. While the order introduces stringent conditions, it does not pause or prohibit construction and leaves the state's data center sales and use tax exemption intact, a separate issue from the permits.