Pennsylvania Gov. Josh Shapiro signed an executive order on Aug. 18 that imposes new permitting, transparency, energy, and environmental requirements on large data centers. The executive order also gives local governments a greater role in determining whether data center projects move forward.
Executive Order 2026-05 imposes new requirements on proposed data centers with peak electricity demand exceeding 25 megawatts and removes all data center projects from the state’s PA Permit Fast Track Program. The order also prohibits agencies under the governor’s jurisdiction from using nondisclosure agreements in connection with data center projects.
The action comes amid a surge of data center interest in Pennsylvania. More than 100 facilities have reportedly been proposed across the state, and the Pennsylvania Department of Environmental Protection has received permit applications for 20 of them, according to the order. Another 14 existing or in-development locations have active tax exemption certificates through the state’s Computer Data Center Equipment Program.
“Over the past year, I’ve listened to the people of Pennsylvania – and I’ve heard directly from many residents across our Commonwealth who are concerned about what data center development could mean for our communities, our environment, and our utility bills,” Shapiro said in a press release announcing the order.
“My message to data center developers is clear: if you can’t agree to our strict requirements and get the community where you want to build to say ‘yes,’ you’re not going to have the Commonwealth’s support either,” he added.
Executive order puts GRID requirements on developers
Under the order, developers seeking a streamlined Department of Environmental Protection review must agree to the Governor’s Responsible Infrastructure Development (GRID) requirements through a legally enforceable Consent Order and Agreement. Those requirements address energy affordability, transparency and community engagement, workforce and economic development, and environmental protection.
Developers that enter into those agreements may have qualifying permit applications reviewed on a rolling basis. However, DEP will not issue permits until the applicant has demonstrated alignment with the local comprehensive plan and the project has received all local approvals.
Developers that do not make GRID commitments face a more restrictive process. DEP will not begin reviewing their applications until they demonstrate alignment with the local comprehensive plan and obtain all local approvals and applicable water withdrawal or wastewater authorizations. The agency will not review applications on a rolling basis. Those projects will also be excluded from the PAyback and Permit Decision Guarantee programs.
The order also directs the Department of Revenue to update the Computer Data Center Equipment Exemption Program so that applicants seeking sales and use tax exemptions must comply with the GRID requirements.
In addition, the order requires DEP to consider whether new environmental regulations are needed for data center operations, including requirements governing emissions from backup generators. The Department of Community and Economic Development will also develop best practices that municipalities can use for zoning standards and community benefit agreements.
Executive order seeks to protect other ratepayers from data-center costs
Energy costs are another focus of the order. Shapiro directed his special counsel for energy affordability to work with the Pennsylvania Public Utility Commission and advocate for rules designed to prevent data center-related costs from being shifted to other customers.
Shapiro cited projections from PJM Interconnection, the largest regional transmission organization in the United States, showing 74 gigawatts of summer peak load growth across the regional grid through 2045, primarily driven by data centers. The order also says data centers accounted for $29.4 billion, or 46%, of capacity charges to ratepayers across PJM’s previous four base residual capacity auctions, citing PJM’s Independent Market Monitor.
The order also calls for utilities to curtail data centers before other customers during certain grid emergencies unless they have secured additional electric capacity sufficient to cover their demand.
Additionally, beginning July 1, 2027, operating data centers must submit annual reports detailing energy, natural gas, and water consumption, peak electricity demand, efficiency measures, environmental protections, and projected energy and water needs.
The order also directs DEP to create a publicly accessible map showing permitting information for proposed data centers known to the department or the Department of Revenue.
Executive Order 2026-05 took effect immediately and will remain in place until amended or rescinded by the governor.
