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Governor Shapiro's Data Center Executive Order - What It Does, What It Doesn't Do, and How Communities Can Use It

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This blog is designed for general informational purposes only and should not be construed to be legal advice.

On August 18, Pennsylvania Governor Shapiro signed an Executive Order (EO) that the Governor’s office says “lays out strict requirements that data center developers must meet regarding energy affordability, community engagement, workforce and economic development, transparency, and environmental protection – and gives local municipalities a greater say over development in their communities.”

Folks in communities across Pennsylvania are concerned about the local, regional, and broader impacts of data center projects proposed in their areas. Let’s take a look at this Executive Order (EO) and explore what it does and doesn’t actually do, and what it means for communities who are thinking about what they should do in the face of the Pennsylvania data center rush.

What Is the Executive Order?

Governor Shapiro’s executive order on data centers, EO 2026-05, sets in motion a host of practices to implement some of his proposed GRID (Governor’s Responsible Infrastructure Development) standards, which are a framework to address some of the concerns about data centers, including energy affordability, local community engagement and approvals, and environmental protection.

The EO has two main parts. The first directs his staff and executive agencies to take certain actions, prioritize certain policies, and recommend future regulatory actions. These are important steps toward the stronger regulations we need, but do not create permanent, enforceable obligations.

The second lays out a voluntary process, where data center developers can commit to the GRID standards, by signing a Consent Order and Agreement (COA), in exchange for a faster permitting process and certain tax benefits. The COA is a legally binding contract that is negotiated between the data center developer and the PA Department of Environmental Protection. Typically, contracts are negotiated between two or more parties, and there is no rule that requires contracts look exactly the same between different groups of parties. This means different data center developers may negotiate different COA terms.. It is unknown how closely DEP will follow the COA template released by the Governor’s office last week.

The EO is a step in the right direction, and is a constructive move by Governor Shapiro to address the people’s concerns, within the constraints of executive power. These voluntary standards must be bolstered by action from the General Assembly to create strong requirements. In the meantime, due to the unique market demands of the data center boom, there is reason to hope that data centers will sign up for this program. However, it is not a cure-all, and communities must take careful action to ensure they are protected.

Top Takeaways

  • The EO represents progress in managing data center development and expanding renewable energy in the Commonwealth. But safeguarding our environment and health should not be subject to data centers voluntarily agreeing to standards.
  • The state legislature must act to make further changes and pass legislation to protect Pennsylvanian communities from rising energy costs and environmental harm.
  • The EO does not stop data center development in Pennsylvania, and it doesn’t give communities blanket power to veto data center development.
  • Communities should update their local zoning code and local planning requirements quickly to make sure that local officials have authority to impose conditions.
  • The EO creates different state permitting paths for future data center developments depending on whether developers enter into COAst. Fair Shake and PennFuture will be monitoring closely for further developments on what this means for applications that are already underway.

The Details

Below, we break down by category what the EO and the model Consent Order and Agreement (COA) would require, top takeaways, and what the different pathways would mean if a data center decides whether or not to agree to the GRID standards. The model COA is a template contract. Typically, contracts are negotiated between two or more parties, and there is no rule that requires contracts look exactly the same between different groups of parties. This means that what is in the COA template could be changed, depending on the developer. PennFuture and Fair Shake will be monitoring COAs to see how they are being negotiated.

Energy Affordability and Accessibility:

What The EO does:

  • The EO requires that the PA Special Council for Energy Affordability create new rules with the Pennsylvania Public Utility Commission and utility companies to try and make sure that, in emergency events, data center energy is lowered or curtailed before other customers.

What the EO does NOT:

  • The EO does not mandate stronger tariffs, lower rates, or other energy permitting and infrastructure funding requirements.

Additional GRID Standard Energy Affordability and Accessibility requirements:

For data centers who agree to GRID standards and sign COA: For data centers who do not agree to GRID standards and sign COA:

COA template says:

  • Data center will be responsible for paying for costs associated with their electric transmission, distribution, network updates, or facilities.
  • Data center must ensure it is building, bringing, or buying enough incremental capacity to meet its own needs.
  • Data center will need to follow the current PUC and local utility connection rules and processes. This means that data centers might follow the PUC final Large Load Customer Model Tariff, but could also negotiate less stringent terms.

Local Control and Community Engagement:

What The EO does:

  • The EO empowers local officials to strongly enforce their own zoning code, and creates a clear process that will prevent developers from obtaining state agency environmental permits, and then using those to pressure local communities into giving other approvals.

What the EO does NOT do:

  • The EO does not change Pennsylvania municipal law, which requires that municipalities allow for every kind of land use somewhere within the town.
  • The EO does not give municipalities the authority to institute a moratorium or to block data center projects completely.
  • The EO does not give residents new decision-making power to block projects, or give residents new power to conduct ballot referendums, initiatives, or recalls.

The GRID Standards for Local Control and Community Engagement requirements:

For data centers who agree to GRID standards and sign COA: For data centers who do not agree to GRID standards and sign COA:

COA template says:

  • Must submit a community outreach plan to the Department of Environmental Protection. The plan must list the schedule and number of in-person public information meetings that will be held (in addition to any public meeting required by law), and must consult with municipal leaders.
  • Must get public comments on design decisions including viewshed impact mitigation, noise impact mitigation and building facade design.
  • Data centers who do not sign the COA are not required to host public information meetings in addition to those already required (through zoning or state permits, for example), and do not need to get public comments on design decisions.

Workforce and Economic Development:

What the EO does:

  • Requires the PA Department of Community and Economic Development (DCED) to prepare best practices on zoning standards and community benefit agreements to give to local governments.
  • A note on language: Fair Shake and other community benefits advocates likes to refer to benefits contracts between developers and municipalities as “host community agreements” or “development agreements” because they often do not involve residents and community groups in the negotiation process, where as a traditional “community benefits agreement” is negotiated between a developer and a group of community members and organizations. See more in this Community Benefits Guide. We think this difference is critical, especially in environmental justice communities, so that residents have a voice and say in the benefits and protections process, negotiations, and any final agreements.

The EO does NOT:

  • The EO does not set standards, requirements, minimums, or safeguards that must be incorporated into community benefit agreements or zoning best practices.
    • Note: municipalities do not need to wait for these best practices! We recommend municipalities and counties update zoning to include data centers ordinances now! Other model ordinances–including PennFuture’s Data Center Model Ordinance–are available to municipalities now, and adoption here will not stop a municipality from making further updates once DCED’s guidance is published.
  • The EO does not create new workforce or economic development pathways, funding, or opportunities for all data centers.
  • The EO does not require Community Benefits Agreements for all data centers.
  • The COA template does not encourage data center developers to negotiate directly with local community members and organizations.

Additional GRID Standards for Workforce and Economic Development requirements:

For data centers who agree to GRID standards and sign COA:

For data centers who do not agree to GRID standards and sign COA:

COA template says:

  • Must offer municipal and county officials a Community Benefit Agreement that includes: development phases; noise, vibration, and lighting studies and mitigation techniques, traffic study, air quality protection requirements consistent with federal and state law, plan for addressing aesthetic concerns including landscaping and visual buffers; emergency management plan that addresses training, coordination and reasonable resource needs of first-responders; [If in EJ area] funding and collaboration with municipal, civic, and private industries to positively impact the population characteristics of the EJ area.
  • Requires data centers who enter into the COA to submit a hiring plan to the Department of Environmental Protection with a hiring plan detailing how they plan to train and hire PA residents; use apprenticeship and skilled construction; create 200 construction jobs; and create 50 new permanent full-time jobs within the first four years of operation.
  • Requires data centers who enter into the COA to pay annual gross compensation of at least $1,500,000 to full-time employees.
  • Not required to participate in a community benefits process. Companies can do this voluntarily, and/or residents can build leverage to try and get the developer to negotiate directly with a community coalition.
  • No job hiring guarantees, numbers, or salary requirements.

Environmental Protection and Permitting:

The EO does:

  • The EO removes data center developments from the state’s fast-track permitting programs, and data centers will be ineligible going forward.
  • The EO creates different permitting pathways. Those that sign on to GRID standards will receive DEP support and assistance, and have their permits processed on a rolling basis. Those that do not agree to GRID standards and do not sign a COA will not have their state permits assessed until all necessary local or municipal permits and authorizations have been received and reviewed by DEP. This will create a longer timeframe for these developers, and potentially delays in their development process.
  • The EO orders the PA Department of Environmental Protections to assess and recommend if new environmental rules and regulations should be created.

The EO does NOT:

  • The EO does not create stronger pollution limits or new permitting requirements.
  • The EO does not create new enforcement or accountability mechanisms than the state already has.

Additional GRID Standards for Environmental Protection and Permitting:

For data centers who agree to GRID standards and sign COA:

For data centers who do not agree to GRID standards and sign COA:

COA template says:

  • Must get some of their energy from ‘clean firm energy resources’ (example: nuclear, hydro, geothermal, or fossil fuel with carbon capture). They can either build this energy directly into their systems or buy it from others. It must count for at least 10% of their energy starting now, and up to 32% by 2035.
  • Use back-up energy generators that are Tier 4 or the same level of air emissions, and follow Federal and State air quality regulations.
  • Put at least 3 air quality monitors at or near the Site that give continuous record of the air quality and that is accessible to the public and Municipal and County government.
  • Requires closed-loop cooling and water-recycling “where feasible”.
  • Requires explanation of defined measures to offset any increased environmental exposures or effects on Environmental Justice Areas.
  • Can use any type of energy.
  • Follow already-established local and state regulations on air-emissions, back-up generators.
  • Do not require publicly accessible air quality monitoring data.
  • No air or water environmental requirements above what is required through current state permits.

Transparency and Enforcement:

The EO does:

  • The EO bans the use of Non-Disclosure Agreements between state agencies, their staff, and data center developers.
  • The EO did create a publicly accessible data center permit tracker map that lists current permitting information. This is an easy way to quickly check for state-level permits that are under review, complete, or operational.
  • The EO does require all data centers to submit an annual report with: Annual Energy Metrics: total annual energy consumptions (MWh), peak hourly demand (MW), and natural gas usage; Annual Water Metrics: total annual water usage (gallons) and peak day consumption; Sales Tax Exemption Verification: Reporting metrics are linked to the Computer Data Center Equipment Exemption Program Guidelines administered by the Department of Revenue to ensure tax incentives are tied to full compliance; For data centers who sign the COA (page 23), they must share the name of any tenant, owner, operator for anyone who is constructing, occupying, leasing, or purchasing part of all of the data center.

The EO does NOT:

  • The EO does not ban the use of Non-Disclosure Agreements between municipal and county officials and data center developers, because municipal and county officials are not state entities that are part of the Executive office.
  • The EO does not state if the annual reports will be shared publicly, when it will be shared, or where.

Additional GRID Standards for Transparency and Enforcement:

For data centers who agree to GRID standards and sign COA:

For data centers who do not agree to GRID standards and sign COA:

COA template says:

  • That all conditions agreed to in it apply to all current and future tenants, owners, and operators.
  • PA Department of Environmental Protection can issue fines (of $25,000-100,000 per day depending on the violation) or take away permits or authorizations taken away if the data center developer does not abide by the COA, in addition to if if the data center developer exceeds permitted levels of pollution or violates an issued state permit.
  • PA Department of Environmental Protection can issue fines or take away permits of authorizations if the data center developer exceeds permitted levels of pollution or violates an issued state permit.

So… What Does This All Mean and How Can Communities Use It?

Overall, this Executive Order creates a choice for data center developers: (a) comply with GRID requirements and benefit from a quicker and more certain path forward; or (b) take on fewer up front commitments, but receive permits slower, and likely ultimately build slower. In a world where speed to construction and power are critically important to the data center business model–to the tune of millions of dollars of lost revenue for every day they do not operate–this Executive Order could prove to be a strong incentive.

There are a few ways that communities can think about how this Executive Order might reduce data center impacts:

Before a Data Center is Built:

  • Use Zoning!

The EO doesn’t add any new legal authority or power for municipalities, but it does underscore the importance and authority that they do have. This makes strong local planning even more important than it was before.

  • Update local zoning to pass data center zoning ordinances that have strong protections, rigorous requirements, transparency mechanisms, and public participation built into the process.
  • Understand your current zoning codes so you know how to use them. Whatever zoning laws are in place when a data center applies locally are the rules it has to follow. Learn what your current zoning says so that you will know when and how to use it if you need to.
  • Leverage your zoning codes and help your local officials feel confident in their power. Developers need local approval before they can get state approvals. Municipal officials should not feel that they are being forced into approvals that they do not want to give and know that they have the power to make sure data center developments abide by their zoning laws, and residents can keep showing up, making comments and sharing your concerns, talking with the media, and supporting your local officials so that everybody knows it’s never a ‘done deal’.

Resources:

Use the Data Center Permit Tracker map to help find environmental permits. You typically have 30-90 days to submit comments and request a public meeting for state environmental permits. This means the earlier you catch something, the more time you have to organize your community, request a public meeting, and submit comments that could influence the permit.

If a permit is not listed on the map, that could mean that a) the data center hasn’t applied for any state environmental permits yet, or b) the data center is starting to talk with the Department of Environmental Protection about their permits, or c) the map hasn’t been updated. In this case, submit Right to Know Requests and/or If you don’t find anything on the map, check the Pennsylvania Code and Bulletin:

  • A new volume of the Bulletin is published each year. A new issue is published each week.
  • Click on the volume and issue you would like to check.
  • Click on "Department of Environmental Protection."
  • Click on "Applications, Actions and Special Notices."
  • Review the list of permit applications. Search (Ctrl-F) by municipality, county, applicant name, and permit type.
  • Once you have found the permit type, application number, and applicant name, you can use that information to file Right to Know requests with the DEP.

Resources:

  • Be on the lookout for rulemaking proceedings at PA Department of Environmental Protection (DEP) and the Pennsylvania Public Utility Commission (PUC).

This Executive Order says that some state agencies may update data center rules in the future. Before changing any rules, state agencies have to seek and respond to public comment. This means that if either of these agencies change their data center laws, you can provide feedback! Right now, connect with experts and organizations who are monitoring these and will help people get involved if and when rulemaking begins. Once a draft rule is released, you can attend public meetings and file comments by yourself, with others, or as part of a large group, to make sure the updated rules help address your data center concerns.

Resources:

  • Learn more about Zoning and Community Benefit Agreements so that you can influence future ‘best practices’ and how local officials implement those best practices. Zoning and Community Benefit Agreements can be written in ways that ensure accountability, transparency, public participation, high standards, and concrete protections and benefits. They can also be developed in ways that ‘roll out the red carpet’ for data centers. If your municipality begins talking about updating zoning or using community benefit agreements, advocate for strong and legally-binding language that will help to protect your community in the future.

Resources:

Zoning:

Community Benefits:

  • Continue to advocate for strong legislation and talk to your local and state officials.

The EO is a good first step, but more is needed to make sure our communities and environment are protected.

You can track what is happening, and advocate for bills and issues you support by contacting your state representatives!

The more people show up, make comments, have 1:1 meetings, talk to the media, and are part of a collective effort, the more influence and impact you can have. Advocate on the biggest data center concerns you have, and the solutions you want your elected officials to put forward. In fact, the Governor is inviting concerns and feedback directly on the pa.gov website.

Resources:

If the data center is built:

  • Hold them accountable to their Consent Order and Agreement if they agreed to GRID standards.

The signed COA should have specific and concrete metrics that you can try to hold the Company and Government accountable to. If you don’t think the Company is upholding their Agreement, you can make complaints to the Department of Environmental Protection.

It’s unclear if the COA will be a publicly accessible document. If you aren’t able to find it, you can submit a Right to Know to try and obtain it.

  • Be part of the Community Benefits Agreement.

The data center will have to offer a Community Benefits Agreement with the municipal and county governments if they sign a COA. This is an opportunity to make sure that residents are at the table negotiating what else should be included within these Agreements - things like air, water, and noise monitoring and protections; funds for community-based projects; transparency mechanisms. Strong Community Benefits Agreements require the right people to be at the table who bring community-based experiences and expertise; those people to have real decision-making power; transparency back with the broader community; and legal language that is written to ensure specific, tangible, attainable, measurable, and time-bound benefits and protections.

Resources:

  • Look At Annual Metrics and Reports.

Track DEP websites for the annual energy, water, and revenue reports companies that follow GRID will need to provide. If they are not shared publicly, submit a Right to Know Request. This can give your community some of the information you deserved to know.

Monitoring data should be publicly accessible that is captured by the three air monitors. Use this to hold the data center accountable and make complaints to PA DEP and local officials if they are going above the amounts of air pollution that they have on their permit approval.

Still have questions?

More Data Center resources at:

Reach out to us at pennfuture.org/Contact-Us or info@fairshake-els.org.