Pennsylvania Governor Josh Shapiro signed Executive Order 2026-05 on August 18, rewriting how the state reviews permits for large data centers. The order applies to any facility with peak demand above 25 megawatts and creates two separate review tracks — one for developers who sign a binding agreement with state regulators, and one for those who don't.
Two paths to a permit
Developers who agree to a consent order with the Department of Environmental Protection get rolling review of their permit applications. That means the state can start working through paperwork as it arrives, rather than waiting for everything to pile up. Those who decline the consent order lose that flexibility: their applications sit until all are filed, and they also lose access to two state programs that guarantee permit turnaround times.
Both tracks share a hard requirement. Before the DEP can issue permits or even begin review, a developer must show the project matches the local comprehensive plan and holds all municipal approvals. Shapiro put it plainly: “if the local community doesn't approve a project, the state won't approve it either.”
The order also strips data centers entirely from the Fast Track permitting program, which was designed to speed up approvals for certain projects.
Why the state changed course
The order cites reports of more than 100 proposed data center facilities across Pennsylvania. The DEP has already received permit applications tied to 20 of them. That wave of projects comes with a heavy price tag for ratepayers. According to the PJM Independent Market Monitor, data centers drove $29.4 billion in capacity charges across PJM Interconnection's last four base residual auctions — 46% of total auction costs. PJM serves all or parts of 13 states and Washington, DC.
Pennsylvania isn't acting alone. In July, New York's governor paused state environmental permit issuance for up to a year. Texas ordered an audit of all data centers, and projects that fail to meet PUCT and ERCOT requirements are barred from connecting to the state's power grid.
Public opposition is widespread. Gallup found that 70% of Americans oppose having an AI data center built near where they live. On July 18, a national day of protest against data centers drew 142 demonstrations across 42 states.
What the order means for pending projects
The 20 facilities with pending DEP applications now face a choice: sign a consent order and get rolling review, or wait in line without the turnaround guarantees. Either way, local approval comes first. That's a significant shift from the old fast-track system, which didn't require the same upfront local sign-off.
The order doesn't set a deadline for developers to decide which track they'll take. It also doesn't say how many of the 100-plus proposed facilities will actually move forward. What's clear is that the state is no longer treating data centers as a special class of project — at least not when it comes to permitting.
