Pa. state House passes 2 measures on data center regulation

The Pennsylvania state House has passed two significant bills aimed at regulating hyperscale data center construction, marking the latest efforts by Harrisburg lawmakers to address a rapidly expanding industry. The first bill proposes a "model ordinance" that municipalities could voluntarily adopt, offering state-drafted recommendations on issues such as building height and size for large cloud-computing and artificial intelligence campuses. The second measure mandates that data centers report their yearly and estimated future water and electricity usage, with a $10,000-per-day penalty for non-compliance, in response to growing concerns over resource consumption. State Representative Kyle Mullins, a Democrat from Northeastern Pennsylvania and sponsor of both bills, highlighted the urgent need for such guidelines, citing at least nine data center proposals in his Lackawanna County district alone. He emphasized that the current development process is perceived by communities as a "reckless gold rush" due to a lack of comprehensive planning. The legislation, supported by all Democrats and some Republicans, now moves to the Republican-controlled Senate committee on Environmental Resources and Energy, where its future remains uncertain. Republican House leader Jesse Topper and State Rep. Jamie Walsh (R-Luzerne) expressed reservations, warning that state-level guidelines could deter investment and arguing that local leaders should set regulations. Conversely, Mullins stated that the data center industry generally opposes the legislation, while environmental groups support it. The Data Center Coalition, representing developers like Amazon and Google, opposes the energy and water reporting requirements, arguing that other industries with significant resource consumption are not singled out. However, proponents like State Representatives Andrew Kuzma (Elizabeth Township) and Eric Davanzo (Smithton) believe the measures are necessary to ensure responsible industry growth without negatively impacting residents or raising energy prices. Additional bills, including one to fast-track permitting for environmentally compliant data centers and another to repeal a sales tax exemption for data center equipment, are also being considered in the legislature.