Gov. Shapiro wants data centers to bring their own power. What's that mean for prices and pollution?

Pennsylvania Governor Josh Shapiro has issued an executive order outlining "GRID standards" for data centers, aimed at making them responsible for their own power generation and grid infrastructure upgrades. The goal is to protect Pennsylvanians from rising electricity costs, as a recent report indicated a 41% jump in average electricity prices between 2021 and 2025, primarily due to natural gas prices and utility infrastructure investments. While the executive order encourages data centers to use new generation, including 32% firm clean energy by 2035, energy analysts like Rob Altenburg note that most developers are opting for natural gas combustion turbines, which, though cleaner than coal, still contribute to planet-warming emissions.

Environmental advocates, including the Clean Air Council, PennFuture, and Sierra Club, have expressed concern that the executive order's emission reduction efforts are insufficient. Alex Bomstein of the Clean Air Council called for a statewide moratorium on AI data center development and emphasized the need for renewables and batteries. These groups are actively challenging an air permit granted to the Homer City data center project, which includes a large gas-fired power plant, arguing its benefits do not outweigh environmental costs. PennFuture attorney Jessica O’Neill criticized the state's unlimited air quality permits and the Department of Environmental Protection's inability to fully consider carbon emissions.

Shapiro's executive order can slow down state permit reviews but cannot mandate compliance with GRID standards without legislative backing. Developers can bypass GRID by securing local permits first, though it might take longer. To solidify these standards, environmental groups are pushing for House Bill 1834, which has passed the state House and is awaiting Senate action, to make GRID standards mandatory. Another bill, H.B. 2496, also in the Senate, would empower local governments to pause data center applications while updating zoning ordinances, indicating a broader effort to regulate data center development across Pennsylvania.