Three data center bills headed to state Senate
A trio of bills passed through the Pennsylvania House of Representatives could dramatically shape the future of data center development in the state.
The first, known as HB 2650, would formally codify the Governor’s Responsible Infrastructure Development (GRID) Standards introduced by Gov. Josh Shapiro in his 2026-27 Budget Address.
The second bill, HB 2198, would end certain tax breaks for data center operators. Under the previous provision, owners could apply for a refund of taxes paid on equipment used to equip their centers.
The third, HB 2496, allows local governments to enact a 180-day moratorium on data center applications in order to adopt or update ordinances relating to their development.
All bills were sponsored by Democratic representatives and passed this week with strong bipartisan support, and now head to the Republican-majority state Senate.
New standards
Shapiro’s GRID standards are designed to form the basis of a new certification framework for any potential data center projects in the state, with “strict accountability standards, transparency and ongoing compliance requirements,” according to a release from the governor’s office.
Its four core tenants are energy affordability; transparency and community engagement; workforce and economic development; and environmental protection.
Projects certified under GRID standards must submit documentation annually that demonstrates ongoing compliance.
If an applicant meets GRID standards and earns certification, the project is then eligible for the Office of Transformation and Opportunity’s PA Permit Fast Track Program that authorizes sales and use tax benefits for the purchase of computer data center equipment, plus participation in preferential tax zone programs, according to a release.
“I’ve heard directly from Pennsylvanians who are concerned about what data center development could mean for their communities, and I share those concerns,” Shapiro said in a statement. “My GRID Standards establish strong, enforceable requirements for any project seeking commonwealth support — requiring developers to bring their own power, engage with local communities transparently, support Pennsylvania workers and protect our environment — and I’m glad the full House voted in bipartisan manner to codify these standards into law.”
Shapiro called on the state Senate to “step up” and send the legislation to his desk.
Local impact
Communities across Washington County have scrambled to adopt their own local zoning ordinances for data center development since a 1,400-acre property in South Strabane Township was listed for sale in fall 2025 as a prime location for a potential data center.
Since then, South Strabane has enacted the first two of a “triumvirate” of related ordinances surrounding data center projects, with about a half-dozen neighboring municipalities following suit with their own ordinances.
Dennis Makel, the South Strabane Township solicitor who helped draft the centerpiece zoning ordinance, said the bills “could be beneficial to people in all municipalities.”
According to Makel, data centers pose a challenge for local governments since the long-term ramifications of their existence are still unknown.
“I spent the past three to five months reviewing everything related to data centers, so we’re still learning,” he said.
Makel said that because much of modern business and personal communication is mediated through computers and smartphones, some degree of data center construction is necessary to support this vital infrastructure, but it should be done in a responsible manner with local residents’ safety in mind.
The moratorium bill could be beneficial in giving municipalities necessary time to update their zoning ordinances before considering a pending data center application.
Makel said that South Strabane, like other local municipalities, had to work quickly to enact their ordinance before a potential application for the Zediker Station Road property arrived at the planning commission.
Residents in the township had called for a moratorium on all data center development before the passage of the ordinance, citing concerns about potential environmental pollution.
If the bill passes in the Senate, South Strabane will have another tool in its toolbox to delay a potential data center project.
“Our thing is to protect the township,” he said.