Ohio, Pa. lawmakers rush to regulate data centers

Ohio and Pennsylvania lawmakers are actively pursuing legislation to regulate the influx of hyperscale data centers, driven by the rapid expansion of artificial intelligence. These facilities, significantly larger and more resource-intensive than traditional data centers, have raised widespread concerns regarding increased energy and water demands, potential impacts on utility costs, farmland preservation, and noise pollution in local communities. In Ohio, the House passed House Bill 646 on March 18, championed by state Representatives Gary Click and Kellie Deeter. This bill aims to establish an Ohio Data Center Study Commission within the Ohio Department of Development, tasked with examining the industry's local impacts and recommending legislative solutions. The Ohio Farm Bureau supported the bill, emphasizing the need for robust regulation to protect farmland. Concurrently, Ohio lawmakers are challenging existing sales and use tax exemptions for data centers, which Governor Mike DeWine vetoed, arguing they are crucial for attracting tech investment. Legislators and the Ohio Farm Bureau are advocating to override this veto. Pennsylvania is also grappling with similar issues, with Governor Josh Shapiro advocating for responsible development through his proposed Governor’s Responsible Infrastructure Development (GRID) standards. House Bill 2150, introduced by Representative Kyle Mullins, aligns with these standards by mandating annual reporting on data center energy and water consumption and identifying environmental impacts, with fines for non-compliance. It passed the House Energy Committee and is awaiting full House deliberation. Additionally, the Pennsylvania House is considering House Bill 2151, sponsored by Representative Kyle Donahue, to develop a model zoning ordinance for local governments, providing guidelines for siting and operation. House Bill 502, introduced by Representative Mandy Steele and co-sponsored by Senator John Kane, proposes creating the Reliable Energy Siting and Electric Transition (RESET) Board to potentially fast-track energy projects for data centers. While the Pennsylvania Chamber of Business and Industry supports this as a way to reduce delays, environmental groups like the Better Path Coalition oppose it, arguing it diminishes local control over development decisions.