Gov. Josh Shapiro last Tuesday signed an executive order imposing new requirements on data center projects seeking to operate in Pennsylvania, including provisions related to electricity usage and others designed to increase transparency, strengthen environmental protections, and give local communities greater influence over proposed developments.

Executive Order 2026-05 directs the Department of Environmental Protection (DEP) to incorporate the Governor’s Responsible Infrastructure Development (GRID) Requirements into its permitting process for data center projects. Shapiro said the standards are not voluntary, and developers must agree to legally binding requirements to receive the approvals needed to build.

The order does not impose a moratorium on data center development, as other states have instituted. However, it requires projects to secure all required local approvals before receiving a state permit, which could effectively prevent some proposed developments from moving forward.

Data centers must pay their own way

A central component of GRID is preventing new data center electricity demand from shifting costs onto existing residential and business customers.

Under the order, developers must pay the full cost of new generation, transmission, distribution, and other infrastructure needed to serve their projects. They must also bring in or purchase sufficient incremental electric capacity to meet their demand.

The requirements include increasing clean-energy requirements, beginning at 10 percent in 2027 and rising to 32 percent by 2035.

The executive order also directs the administration’s Special Counsel for Energy Affordability to work with the Pennsylvania Public Utility Commission on additional protections for ratepayers.

Those efforts include establishing procedures to ensure that data centers are among the first customers to have their electricity service curtailed during periods of grid stress and requiring data centers to cover the infrastructure costs associated with their electricity demand.

Local approval and transparency

Developers must also provide notice of their intent to comply with GRID, submit detailed project plans to DEP, and enter into a legally binding Consent Order and Agreement outlining their obligations and penalties for noncompliance.

The requirements also call for transparency with local communities, local hiring, and community benefits agreements. DEP will not issue required permits for data center projects until all required local approvals have been obtained.

Developers will also be required to provide information about their projects, including details on energy and water consumption. The administration said nondisclosure agreements will not be permissible for data center projects.

As part of the order, the Department of Community and Economic Development (DCED) will release best practices for municipalities on zoning standards and community benefit agreements. DEP also launched a public map showing data center projects that have engaged with the department and the status of their permits.

Fast Track removed

The executive order immediately removes data center projects from Pennsylvania’s PA Permit Fast Track Program and makes them ineligible for the program going forward. Previously, nine data center projects had received Fast Track status, including two Amazon facilities in Bucks and Luzerne counties.

Growing number of proposals

The executive order comes as interest in Pennsylvania as a data center location has increased sharply.

According to the administration, more than 100 data center proposals have been identified through publicly available sources. Shapiro characterized most as speculative, noting that many have not taken formal steps to seek state approval.

Of the more than 100 proposals, Shapiro noted that 58 have engaged with DEP at some level, 15 have applied for at least one DEP permit, and five have received all permits necessary to begin their first phase of development.

The governor’s executive action follows House lawmakers’ approval of the GRID requirements as part of House Bill 2650 earlier this year. The state Senate has not voted on the legislation.