Pittsburgh, PA
Data Center Development Alert
(by Justine Kasznica and Susanna Bagdasarova)
Pennsylvania’s data center market continues to evolve rapidly as policymakers, regulators, and grid operators respond to growing electricity demand and reliability concerns associated with large-load customers and AI-driven infrastructure development. Recent actions by Governor Josh Shapiro, the Pennsylvania Public Utility Commission (PUC), and PJM Interconnection (PJM) underscore the increasingly complex regulatory and commercial landscape facing data center developers, operators, utilities, and investors in the region.
On May 27, 2026, Governor Shapiro released the Governor’s Responsible Infrastructure Development (GRID) standards, a new set of guidelines for data center development in Pennsylvania, as previewed in his 2026-2027 budget proposal. To qualify for Commonwealth support, including tax benefits and eligibility for streamlined permitting, developers will need to demonstrate engagement in four core areas: (1) energy affordability, (2) transparency and community engagement, (3) workforce and economic development, and (4) environmental protection. The GRID Standards require each developer seeking such incentives to submit plans to outlining its commitment to:
- Provide for its energy needs without imposing additional costs on other utility ratepayers;
- Create a community outreach plan that includes holding public meetings and consulting with local governments to promote public engagement and transparency;
- Commit to a minimum of $250 million in cumulative new investment, facilitate local job creation and develop community benefit agreements with the local jurisdiction; and
- Submit a sustainability plan detailing how it will protect water and energy resources and commit to environmental protection standards.
On May 13, 2026, the PUC issued a Final Order establishing what it described as a “first-of-its-kind” model tariff framework for large-load customers, including data centers, which is intended to guide electric distribution companies as they evaluate and serve such customers. …