Today, Governor Shapiro signed an Executive Order (EO) that regulates data centers in Pennsylvania in various ways. I read it… so you don’t have to. You’re welcome. 🩷

Always a skeptic of media spin, I used my own two eyes and one brain to read the EO’s words myself. Here’s what you need to know about the regulations Governor Shapiro spun up about these behemoths that turn electrons into braintrons.

FWIW, the clips I’ve seen of him describing the EO on social media are forthcoming and honest. They’re simplified, of course, but I don’t think he’s telling a wholly different story than the one written in the executive order.

Image of future data center rendering — Data center rendering; Image via

Cliff Notes on the new Executive Order re: Data Centers in Pennsylvania

I think the EO is really solid. It incorporates many of the best practices already in place elsewhere. In my opinion, it does a decent job of balancing economic drivers with constituent protections and local agency. It offers a mix of carrots and sticks.

Super high level, this new executive order around data centers in Pennsylvania:

makes data centers “pay their own way” for new electricity generation, transmission, distribution, and other infrastructure to protect energy affordability
requires transparency and compliance around environmental standards and considerations, including energy use, water use, air pollution, etc., to protect our quality of life and our natural resources
puts local community approval ahead of state approval, so local communities retain agency over their community development decisions
incentivizes data centers to pay for clean energy generation and desperately needed upgrades to our grid
prohibits non-disclosure agreements in connection with data center development

There are still state sales and use tax incentives for data centers (I don’t know all the details), but I wish they’d get rid of them. Data center developers are cash-rich. They don’t need tax incentives.

No data center moratorium is a good thing

Unlike some other states, the EO does NOT include a moratorium. This might be my hot take, but I think this is a good thing! Why? Provided the regulations prevent data centers from running roughshod on local communities, there are opportunities for data centers to fund beneficial community development.

Data centers have REALLY deep pockets. If done responsibly, data center development could fund the clean energy transition in our country. We want this!
Data centers can also generate significant tax revenue AND commit to valuable, legally-binding community benefit agreements with their new neighbors. If a local community wants a data center AND can ensure it’s developed responsibly (which this EO helps ensure), there is a real opportunity for shared prosperity. I don’t think our state government should take this agency away from local communities, provided appropriate environmental, energy affordability, and transparency guardrails are in place.

Shapiro sums it up well:

“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,” said Governor Josh Shapiro. “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. These are some of the biggest companies in the world — they can afford to be good neighbors, follow the rules, and do this right.” (bold emphasis mine) (source)

Long story short: Pennsylvania now has regulatory oversight over data center development in a way that protects residents without entirely shutting down reasonable market-driven opportunities for data centers to be good neighbors.

What do you think about data centers in Pennsylvania?

I’d love to hear your hot take (or cold take or lukewarm take). 😉 Give it to me! What questions do you have about data centers in our state and their development more broadly?