HARRISBURG — Pennsylvania Gov. Josh Shapiro chided the speculative nature of data center proposals on Tuesday, criticizing developers for pushing projects onto communities that he said would never be built and signing an executive order seeking to establish the nation’s “strictest guardrails.”
There are an estimated 100 data center proposals across Pennsylvania, but just five developers have the permits necessary to function, and none are in operation, Shapiro said during prepared remarks at the State Capitol.
Just 14 months removed from announcing that Amazon would invest $20 billion building two data centers in Bucks and Luzerne counties, described as the largest private sector investment in commonwealth history, Shapiro said too many other proposals floating purely on speculation have done little more than create chaos in local communities.
They lack detailed plans, sufficient financing, electric generation, state permits and agreements with tech companies to operate the facilities, he said.
“We have a long history in Pennsylvania of industry running roughshod over our communities to make a buck — that stops with me,” Shapiro said.
The order is the most meaningful evidence of a positional shift to the welcoming attitude with which Shapiro first met data center developments, and it follows a cacophony of public opposition to projects in Pennsylvania where residents are concerned about the potential drain on water resources and electricity, plus noise pollution.
Shapiro signed a multi-pronged executive order toward more tightly regulating development, but it doesn’t institute a statewide moratorium on developments.
The order does the following: Removes all current developments from Pennsylvania’s fast-track permitting program and prevents future projects from being included; bars state agencies from entering non-disclosure agreements on data center projects; prevents any state permits from being issued before local governments approve land use agreements; requires that developers pay the full cost to bring electricity to the project without shifting costs to residents and businesses; directs developers to enter into a consent order and agreement with Pennsylvania to abide by terms of the previously announced Governor’s Responsible Infrastructure Development program, or GRID.
“If you do not follow GRID, we don’t want your business, we don’t want you here, you should look elsewhere,” Shapiro said of the program, which had first been proposed earlier this year as voluntary to both enter the fast-track permit program and also benefit from a sales tax break on data center materials.
The order also includes provisions on public transparency, local hiring and community benefits agreements, and environmental mandates to adhere to Pennsylvania’s constitutional rights to clean air and pure water.
And it requires that in the event of a failure of the electric grid, data centers aren’t exempt from having service temporarily halted at the expense of residents and businesses.
“I want to be clear, these are not voluntary standards. These are legally binding requirements to operate in the Commonwealth,” Shapiro said.
If a developer doesn’t comply with GRID, none of their permit applications will be considered until all local land use approvals are obtained, Shapiro said. Should that happen, the state applications won’t be prioritized, and all permits will be packaged for review and potentially issued at the same time.
The GRID standards moved through the Democratic-controlled House with strong bipartisan support. The Republican-led Senate hasn’t yet considered the proposal, which drew criticism from Shapiro.
In a prepared statement, Senate Republican Majority Leader Joe Pittman said work will continue this legislative session, one that ends in November, on outstanding proposals concerning data centers. He noted that budget-enabling legislation did address data centers, requiring annual public reports on energy and water usage, and that a Senate proposal to rescind the sales tax was lost in a bill he said was amended beyond recognition in the House.
Matters of regulatory framework, a proposed moratorium and rescinding the sales tax break haven’t been resolved.
“A year ago, Gov. Shapiro proudly announced his administration was ‘already all in on AI’ and ‘the future of AI is going to run right here through the Commonwealth of Pennsylvania.’ His comments today seem aimed at erasing his remarks from last year and underscore how afraid he’s become over his previous record of embracing data centers, only to find out how politically intense the proposals have become. He’s not seriously engaged on this issue, other than what we have seen on his data center-driven social media,” Pittman said.