Pennsylvania’s GRID Project consent order imposes strict new regulatory requirements on data center developers.
On August 18, 2026, Governor Josh Shapiro signed Executive Order 2026-05, titled “Protecting Pennsylvania Consumers from Data Center Impacts,” introducing sweeping new requirements for data center development across the state. The order establishes two distinct permitting tracks. Developers who execute a project-specific Consent Order and Agreement (COA) with the Pennsylvania Department of Environmental Protection (DEP) gain access to an expedited rolling review process. Conversely, developers who do not execute a COA will find that the DEP is directed not to begin reviewing any application until all local approvals and required water and wastewater authorizations are fully completed and documented.
Spanning 33 pages, the COA sets comprehensive standards covering energy procurement, community involvement, air emissions, water consumption, and ongoing compliance reporting. At the point of executing the agreement—often well before construction begins—developers must submit binding estimates of their peak electric demand, future energy needs, primary and backup power sources, and water consumption figures. Once filed, these metrics become legally unchallengeable. Paragraph 2 of the COA explicitly states that developers “shall not challenge or deny the DEP’s assertion of the truth, accuracy, or validity of those findings in any matter between the developer and DEP.”
The agreement mandates that developers secure “Clean Firm Energy” sourced from Pennsylvania-based resources. The requirement begins at 10 percent of annual electricity consumption on January 1, 2027, increases to 14.5 percent by 2030, and reaches 32 percent from January 1, 2035 onward. Qualifying technologies include nuclear, hydroelectric, geothermal, fuel cells, solar paired with storage, wind paired with storage, clean hydrogen, battery storage, and long-duration storage resources.
Developers who fail to meet minimum Clean Firm Energy obligations must make an Alternative Compliance Payment to the Pennsylvania Energy Development Authority. This payment is calculated as a shortfall based on the estimated average levelized cost of unsubsidized solar photovoltaic generation. Penalties for violating energy-related provisions range from $25,000 to $100,000 per megawatt of the data center’s rated capacity, per day, for each infraction, while a flat $25,000 daily penalty applies to other breaches. These penalties are automatic and enforced without notice; paying them does not absolve developers of their underlying obligations nor shield them from further DEP enforcement action.
The COA is structured to bind both the physical site and the specific project, meaning any tenant, owner, or operator assuming an interest in the development inherits the same obligations as the original signatory. A developer’s liability survives any subsequent transfer of the site, though the DEP retains sole discretion over whether to modify or terminate obligations following such transactions. An important exception exists under Addendum A for projects that, as of August 18, 2026, had already submitted a permit application to the DEP and executed a binding Electric Service Agreement or Transmission Security Agreement. These qualifying projects are eligible for softened energy obligations.
Industry guidance strongly advises developers to engage with the DEP as early as possible and to execute the COA only when demand and capacity plans are as firm as possible. Upon signing, developers must be prepared to fulfill several immediate obligations, including establishing public information meeting schedules and implementing a Pennsylvania workforce hiring plan, both within 60 days.