Pennsylvania Governor Shapiro issues an executive order establishing streamlined permitting and grid interconnection protocols for qualifying data center projects.
On August 18, 2026, Governor Josh Shapiro signed Executive Order 2026-05, establishing new standards for data center development across Pennsylvania. The order initiates implementation of the Governor’s Responsible Infrastructure Development (GRID) Requirements, first announced earlier this year. More than 100 data center projects have reportedly been proposed in the Commonwealth, though as of the order’s effective date, the Department of Environmental Protection had received permit applications for only 20. The executive order introduces new permitting standards, enhanced transparency mandates, and revised ratepayer requirements to govern future development.
Data center expansion has emerged as a major economic driver in Pennsylvania. According to the Pennsylvania Chamber of Business and Industry, the sector contributed $14.4 billion to the state economy in 2023, rising to $21.2 billion when spillover effects are included. The Chamber also highlighted more than $90 billion in announced energy and data center projects statewide. Notable developments include CoreWeave’s $6 billion Lancaster County facility, expected to create 175 permanent jobs alongside 600 construction positions, and PowerHouse Data Centers’ PAX 1 campus in Middlesex Township, projected to generate approximately $10 million annually for the township and $45 million for the local school district, along with roughly 500 permanent jobs and 1,400 construction roles. Industry groups further note that data center employment stimulates additional hiring in construction, maintenance, and local services.
This investment surge is accompanied by substantial electricity demand. PJM Interconnection’s 2025 Load Forecast projects 74 gigawatts of new summer peak load through 2045, with data centers identified as the primary catalyst. That demand has already impacted Pennsylvania consumers: across the regional grid operator’s last four capacity auctions, data centers accounted for nearly $29.4 billion in capacity charges, representing 46 percent of total auction costs. This figure reflects a negotiated price cap that the administration states has shielded ratepayers from more than $30 billion in potential expenses.
Executive Order 2026-05 directs several state agencies, most notably the Department of Environmental Protection (DEP) and the Department of Revenue (DOR), to execute specific actions. A central feature of the order is a bifurcated permitting pathway. Developers who sign a Consent Order and Agreement and secure local zoning and municipal approval will qualify for a rolling review of their permit applications. Those who decline to enter such an agreement will face a sequential review process and will be ineligible for the state’s PAyback or Permit Decision Guarantee programs. The order also prioritizes local oversight, requiring alignment with comprehensive plans and municipal or zoning approval prior to initiating state permitting. Beyond permitting, the directive signals forthcoming regulatory measures addressing cost and reliability impacts, instructing the Governor’s Special Counsel for Energy Affordability to collaborate with the Public Utility Commission (PUC) on rules governing curtailment priority and cost allocation for data center customers.
The executive order has elicited a divided response in Harrisburg. Senate GOP Majority Leader Joe Pittman characterized the order as a reversal of the administration’s prior stance, noting that Governor Shapiro had previously championed Pennsylvania’s role in artificial intelligence development. Pittman suggested the policy shift reflects “how politically intense the proposals have become.” He also pointed out that the Senate has not brought GRID-related legislation to a vote, which Shapiro cited as his rationale for acting unilaterally rather than awaiting legislative action. Conversely, House Democratic leaders praised the order as a “commonsense” measure that “will hold data center developers accountable and protect our communities, utility costs and environment.” Separately, lawmakers from both parties, along with Republican gubernatorial candidate Stacy Garrity, have advocated for a moratorium on new data center development in the state.
Implementation is expected to commence in the coming months, with the DEP and PUC developing the template Consent Order and Agreement and advancing related rulemaking. For prospective developers, the practical outcome is a streamlined yet conditional regulatory landscape: securing early local approvals and demonstrating compliance with GRID Requirements will significantly influence both the timeline and trajectory of state permit approvals. Additionally, the Shapiro Administration has launched an online portal allowing constituents to submit concerns and feedback regarding locally proposed data center projects.
According to analysis by the authors at Duane Morris Government Strategies, Executive Order 2026-05 mandates that data center developers proposing projects exceeding 25 megawatts satisfy updated permitting, transparency, and ratepayer cost obligations to access the Commonwealth’s expedited permitting track. The order further compels state agencies to pursue new PUC regulations addressing curtailment priority and cost allocation specifically for data center customers.