HARRISBURG, Pa. — Gov. Josh Shapiro signed Executive Order 2026-05 on Tuesday, August 18, directing Pennsylvania agencies to impose strict new requirements on data center developers. The order introduces measures designed to protect residential ratepayers from bearing energy and infrastructure costs, while giving local municipalities binding authority in the project approval process.
"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," Shapiro stated at the signing.
The Governor's GRID Requirements
The executive order instructs the Pennsylvania Department of Environmental Protection (DEP) to review permit applications for data center projects with a peak demand exceeding 25 megawatts through the new Governor's Responsible Infrastructure Development (GRID) Process. To participate, developers must execute a project-specific Consent Order and Agreement committing to the standards.
Key provisions under the GRID framework include:
- Infrastructure & Cost Protection: Developers must pay 100% of the capital costs for new electricity generation, transmission, distribution, and network upgrades needed for their facilities, preventing power utilities from passing these expenses onto other Pennsylvania utility customers.
- Clean & Firm Energy Phasing: Developers must supply incremental electric capacity to serve their demand, incorporating clean, dispatchable energy resources located within Pennsylvania. Minimum targets for these energy resources begin at 10% in 2027, increasing to 14.5% in 2030, and reaching 32% by 2035.
- Local Approval Priority: DEP is legally barred from issuing qualifying permits until a project secures all necessary local and municipal zoning approvals. Uncooperative projects that bypass GRID standards must still obtain local municipal approvals before state permit reviews can begin.
- Transparency & Oversight: The order immediately removes artificial intelligence data center projects from the PA Permit Fast Track Program and bans non-disclosure agreements (NDAs) between developers and local officials. Additionally, the Department of Revenue will update the Computer Data Center Equipment Exemption Program guidelines to revoke sales tax exemptions for non-compliant developers.
Background and Scope
According to the Governor's Office, more than 100 data center proposals are currently circulating across Pennsylvania, though administration officials characterized many as speculative proposals without firm tech partners or state permit filings. State records show 58 projects have engaged in initial discussions with the DEP, 15 have formally applied for state permits, and five have received full permitting for initial development phases.
