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Governor Josh Shapiro signed an Executive Order (EO) directing the Department of Environmental Protection to only review permit applications if developers have made a legally binding commitment to meet the Governor’s Responsible Infrastructure Development (GRID) Requirements and have received local approval.

 The GRID Requirements demand developers meet strict standards on energy affordability, environmental protection, workforce and economic development, transparency, and community engagement.

 The Executive Order removes all AI data center proposals from the Fast Track permitting process and prohibits the use of nondisclosure agreements for data center projects.

 This Executive Order shall take effect immediately and shall remain in effect until amended or rescinded by the Governor.

 Among other things, the EO includes the following guiding principles:

Establishing Strict Guardrails for Data Center Development – “The Department of Environmental Protection (DEP) shall develop a template Consent Order and Agreement that developers of any data center with peak demand of over 25 MW must execute and submit for the review process described in Paragraph 1(b). The template Consent Order and Agreement shall incorporate terms and conditions to ensure compliance with the GRID Requirements.”

EP shall establish a review process for any permit or authorization application submitted after the effective date of this Executive Order in connection with a data center project with peak demand of over 25 MW by an applicant that commits to follow the GRID Requirements.

For any permit or authorization application submitted after the effective date of this Executive Order in connection with a data center project with peak demand of over 25 MW by an applicant that has not executed a Consent Order and Agreement to comply with the GRID Requirements.

DOR shall, under Article XXIX-D, Section 2938-D of the Act of March 4, 1971, P.L. 6, No. 2, known as the Tax Reform Code of 1971, prescribe all necessary forms and procedures and make all necessary updates to the Computer Data Center Equipment Exemption Program Guidelines to ensure applicants for the sales and use tax exemption on or after the effective date of this Executive Order comply with the GRID Requirements.

The Office of Transformation and Opportunity shall remove any existing data center project from the PA Permit Fast Track Program, established under Executive Order 2024-04, PA Permit Fast Track Program, and data center projects shall no longer be eligible for the PA Permit Fast Track Program.

Making Data Center Development Transparent – For all agencies under the Governor’s jurisdiction, the use of non-disclosure agreements in connection with a data center project is impermissible.

DEP shall create a publicly accessible map with current permitting information about all proposed data center projects known to DEP or DOR.

DEP shall notify data centers currently operating within this Commonwealth that by July 1, 2027, and by July 1 of every year thereafter, they must comply with the requirement to submit the energy and water consumption report required under Article XVIII-B, Section 1813-B of the Act of April 9, 1929, P.L. 343, No. 176, known as the Fiscal Co

Protecting Pennsylvania Consumers – To limit reliability impacts on the electric system caused by data centers, the Governor’s Special Counsel for Energy Affordability (“Special Counsel”) shall engage with the Pennsylvania Public Utility Commission (“Commission”), and shall advocate for the rapid development of rules, procedures, and orders that would:

Ensure each electric utility that has received a request to interconnect a data center in its territory files with the Commission revisions to both its pre-emergency interim resource adequacy service (IRAS) and emergency load control procedures so that utilities curtail data centers prior to any other customer during pre-emergency IRAS or emergency events, unless the data center customer has secured incremental electric capacity for the entirety of its demand; and

Ensure that utilities do not classify a data center as critical load exempt from curtailment during pre-emergency or emergency events.

To limit electric system costs caused by data centers from being imposed on other customers, the Special Counsel shall engage with the Commission, and shall advocate for the rapid development of rules, procedures, and orders that would allow for the timely approval of utility tariffs that accomplish the following: (1) Charge the appropriate data center customers for any PJM reliability backstop auction costs in accordance with the procedures ultimately approved by the Federal Energy Regulatory Commission in docket ER26-3380-000; and (2) Prevent an electric utility from charging non-data center customers for backstop auction costs, including in the event that a data center becomes insolvent or is otherwise not able to pay the auction costs assigned to it; and (3) Ensure that data center customers pay all Commission-jurisdictional interconnection costs that the utility incurs due to the development of data centers.

In advance of PJM’s reliability backstop auction and related actions, the Special Counsel shall engage with the Commission, and shall advocate for the rapid development of rules, procedures, and orders: Executive Order 2026-05 Page 7 of 8 (1) For electric utilities to submit megawatt adjustments for any reliability backstop auction target in accordance with the procedures ultimately approved by the Federal Energy Regulatory Commission in docket ER26-3380-000; and (2) For electric utilities to register large loads in PJM’s large load registry, including any locational requirements for incremental electric capacity; and (3) For implementation of credits pertaining to PJM’s pre-emergency IRAS program following the Federal Energy Regulatory Commission’s ultimate disposition of relevant rules and procedures in docket ER26- 3515-000.

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