What Shapiro’s new data center order does — and doesn’t — force developers to do
Pennsylvania Governor Josh Shapiro signed an executive order implementing stricter environmental and transparency standards for new data center developments over 25 MW. The order aims to disincentivize speculative projects by making local zoning approvals a precondition for state permits and tying state sales tax exemptions to compliance with new GRID standards. It also directs state agencies to advocate for utilities to prioritize power curtailment for data centers during emergencies and prevent cost increases for consumers.
Pennsylvania Governor Josh Shapiro has signed an executive order that imposes much stricter environmental and transparency standards for new data center developments within the state. The order, which applies to data centers with peak demand over 25 MW, is not a moratorium but significantly changes the permitting process.
The new policy establishes two tracks for developers. The easier track requires data center developers to sign a "consent order and agreement" incorporating Shapiro’s Governor’s Responsible Infrastructure Development (GRID) standards and to provide documentation of all local approvals. This allows them to receive state permits on a rolling basis. Developers who do not sign this agreement will face a more difficult process, needing to submit all permitting and authorization applications before any single permit is issued.
Key changes include making local zoning approvals a prerequisite for state permits, a shift from previous practice where developers could begin earthmoving with state permits before securing local zoning. The administration believes this will curb speculative data center proposals that cause community concern without any guarantee of construction. Additionally, the executive order unilaterally makes adherence to GRID standards a condition for receiving Pennsylvania's sales tax exemption for data centers, a measure Shapiro had previously sought through legislation.
The order also mandates that state agencies advocate for the Public Utility Commission to revise protocols to ensure data centers have their power curtailed before other customers in emergencies and to prevent utility costs from being passed on to consumers. The Department of Environmental Protection is instructed to recommend new regulations to mitigate negative environmental impacts from data centers, such as emissions from diesel backup generators. While Shapiro maintains his authority to issue the order, it includes a severability clause.