Requiring data centers to bring their own energy sources is a top promise made by political leaders across the country, not just Shapiro. But experts say the specific policy details are crucial.<\/p>\n
John Quigley, a former secretary of the state\u2019s Department of Environmental Protection and now senior fellow at the Kleinman Center for Energy Policy at the University of Pennsylvania, notes that the primary fuel powering the data center development rush so far is natural gas. But with a yearslong queue for back orders of new gas turbines and more of the gas itself being liquefied and shipped overseas, he questions whether it\u2019s even feasible as a short-term solution to require data centers to generate new electricity.<\/p>\n
That\u2019s to say nothing of the climate considerations of burning more gas, which Elizabeth Marx, executive director of the Pennsylvania Utility Law Project, notes has driven some advocates to propose a different policy: BYONCE.<\/p>\n
\u201cThat\u2019s the buzzword of the moment\u2014Bring Your Own New Clean Energy,\u201d Marx said.<\/p>\n
Consumer advocates like Marx, along with tech companies, industrial developers, politicians and everyday Pennsylvanians, have waited months to see what Shapiro would come up with. The governor has been a major proponent<\/a> of bringing the AI data center industry to Pennsylvania, but tacked hard in messaging this year as public sentiment turned<\/a> against such facilities. The stakes are high for the first-term governor, who could use a successful reelection campaign as a springboard for a presidential run in 2028.<\/p>\n During a February budget address, Shapiro introduced<\/a> the \u201cGovernor\u2019s Responsible Infrastructure Development (GRID) Standards,\u201d a set of policy principles he said would address data center concerns. A top pledge: that data centers would have to provide their own energy to obtain state support.<\/p>\n But many questions remained. What kinds of carrots and sticks could Shapiro wield to ensure compliance? How much help would he need from Pennsylvania\u2019s divided legislature? Would he include provisions for clean energy? Would GRID address the transmission and distribution costs that would otherwise hit consumers in the wallet?<\/p>\n The policy details released Wednesday<\/a> provide some answers, while making clear the governor understands the public mood.<\/p>\n \u201cI\u2019ve heard directly from Pennsylvanians who are concerned about the impact data center development could have on their communities, the environment, and their utility bills,\u201d Shapiro said in a prepared statement. \u201cThat\u2019s why I am putting clear guardrails in place to hold developers accountable to protect consumers, strengthen communities, and put Pennsylvanians first.\u201d<\/p>\n The GRID standards cover four areas: energy affordability first, followed by transparency, economic development and environmental protection. On energy, developers \u201cmust agree to build, bring online, or buy incremental electric capacity needed to meet new energy demand while paying the full cost of the capacity,\u201d the administration said.<\/p>\n That new energy generation must be within the same region of the grid as the data center, and the developer must also agree to use an escalating portion of \u201cclean firm\u201d energy sources: 10 percent in 2027, 14.5 percent in 2030 and 32 percent in 2035. Shapiro\u2019s office defined those energy sources as \u201cnuclear energy, hydroelectric power\u2026 geothermal energy, fuel cells, solar energy, including solar energy paired with storage resources, wind energy, including wind energy paired with storage resources, clean hydrogen-fueled energy generation, and long-duration storage resources.\u201d<\/p>\n Under the standards, data centers developers would also have to pay for \u201call costs\u201d associated with grid infrastructure upgrades triggered by their project.<\/p>\n \u201cAs Pennsylvania continues to compete for major economic development projects and lead on innovation, we have a responsibility to set strict accountability standards and ensure these projects create real opportunity for our communities,\u201d Shapiro added.<\/p>\n Quigley says many of the provisions around BYOE and infrastructure costs are a \u201cbig step in the right direction.\u201d But as a whole, he said, GRID is a mixed bag with a big weakness: Pennsylvania\u2019s divided legislature.\u00a0<\/p>\n \u201cMajor pieces of this program still require passage of legislation by the General Assembly, and until then won\u2019t change the facts on the ground in host communities,\u201d Quigley said.<\/p>\n That\u2019s a concern the the nonprofit Food & Water Watch also hit on, calling GRID a \u201cnaive effort\u201d to use voluntary measures to rein in \u201ccorporations who want to exploit our state for profit.\u201d<\/p>\n For its part, the Shapiro administration said it would work with legislative leaders \u201cto introduce accompanying legislation that will codify the GRID Standards into law.\u201d<\/p>\n \u201cAs Clean as Possible\u201d<\/strong><\/p>\n Policy experts will be combing through the details and watching closely how Shapiro executes his plan. Claire Lang-Ree, clean energy advocate at the Natural Resources Defense Council (NRDC), is particularly focused on BYONCE\u2014adding more policy preferences for renewable energy sources\u2014to address both short-term consumer cost concerns and support long-term climate mitigation. In 2024 alone, a dozen of the country\u2019s $1 billion weather disasters hit Pennsylvania, according to the National Oceanic and Atmospheric Administration<\/a>, and other analyses<\/a> predict the state could be dealing with $15 billion in climate costs by 2040.<\/p>\n \u201c[This moment] could be a great opportunity for states to meet their clean energy targets, especially by doubling down on things like battery storage that are very capable of serving data centers, can get built really quickly and can be paired with renewable resources to be as clean as possible,\u201d Lang-Ree said.<\/p>\n Robert Routh, a Pennsylvania policy director for NRDC, said the GRID standards are among \u201cimportant steps\u201d policymakers in the state are making to advance clean energy affordability, noting one provision to require the roofs of all data centers with over 100,000 square feet of floor space to be built \u201csolar ready.\u201d<\/p>\n Then there\u2019s ensuring that data centers also pay for transmission upgrades, an infrastructure cost often socialized through utility bills. Marx, the consumer advocate, said the swift rise in regional energy bills has so far been largely driven by forecasts of impending scarcity in energy generation. But if unaccounted for, the looming costs to also build new poles, wires and transformers to deliver new energy will hit consumers hard in a second wave.<\/p>\n \u201cWe have yet to see the transmission cost increases that are coming, because a lot of transmission is currently being built to transport energy\u201d and the tab won\u2019t show up for consumers until it\u2019s done, Marx said. \u201cSo we\u2019re not seeing that spike yet, but it\u2019s coming.\u201d<\/p>\n \u201cRight now, the problem is that there are no rules. We\u2019re dealing with outdated forms of regulation that don\u2019t fit this new thing that we\u2019re trying to figure out.\u201d<\/p>\n \u2014 Elizabeth Marx, Pennsylvania Utility Law Project<\/p><\/blockquote>\n There are yet wonkier policy considerations. And they don\u2019t make for good slogans.<\/p>\n \u201cThe real solution is bring your own incremental clean energy, batteries, load flexibility and demand response,\u201d Quigley said with a chuckle. \u201cThat\u2019s what we need.\u201d<\/p>\n In Quigley\u2019s view, addressing energy costs will not only require building new, clean energy generation and accounting for transmission costs, but also modernizing the grid in a way that makes more use of existing generation. That could involve everything from improving forecasting of how many data centers will actually be built, to better integrating battery storage into the grid, to asking data centers to shift their peak-use times or curtail their operations during times of grid stress.<\/p>\n \u201cWe can get a lot more out of the existing grid,\u201d Quigley said. \u201cWe shouldn\u2019t default to incredibly expensive new development.\u201d<\/p>\n Identifying the proper suite of energy policy solutions is complicated enough for any lawmaker. But for Shapiro\u2019s office, implementation is the greater hurdle. Experts say his office will have to interface with the Federal Energy Regulatory Commission (FERC), regional grid operator PJM Interconnection, the Pennsylvania Public Utility Commission (PUC) and state legislators to get anything comprehensive done.<\/p>\n And some, like Marx, fear that many agencies are still playing catch-up in this new era of energy scarcity.<\/p>\n \u201cRight now, the problem is that there are no rules,\u201d Marx said. \u201cWe\u2019re dealing with outdated forms of regulation that don\u2019t fit this new thing that we\u2019re trying to figure out.\u201d<\/p>\n Going Nuclear<\/strong><\/p>\n If there\u2019s a standard-bearer for \u201cbring your own energy\u201d in Pennsylvania, it might be on Three Mile Island, where Microsoft has agreed to a deal with Constellation Energy to restart a shuttered nuclear power plant<\/a> and provide carbon-free power to its data centers.\u00a0<\/p>\n But there\u2019s a complication that is emblematic of the challenge ahead for policymakers: Microsoft appears primed to send its electrons out of state.<\/p>\n Unlike some other mega deals<\/a> in Pennsylvania, in which data centers are co-locating near and connecting directly to power sources, Microsoft has not announced any plans to build an AI data center near the nuclear plant (now renamed the Crane Clean Energy Center), nor anywhere else in Pennsylvania.\u00a0<\/p>\n But the company does have significant data center holdings in not-too-distant Northern Virginia<\/a>, which the company claims to already power with out-of-state nuclear energy<\/a>. Microsoft also plans to build a large data center in West Virginia, powered by off-grid natural gas, which some analysts calculate could increase the climate-conscious company\u2019s greenhouse gas emissions by 44 percent<\/a>.<\/p>\n Exactly where Microsoft plans to take credit for the carbon-free electrons generated by Crane is unclear, and the company declined to specify in an email to Inside Climate News.\u00a0<\/p>\n Regardless, Ari Peskoe, director of Harvard Law School\u2019s Electricity Law Initiative, said that energy from the plant will inevitably funnel into the PJM grid, theoretically helping to address scarcity in a 13-state region that includes Pennsylvania, and potentially having outsized reliability and economic effects in its host state.<\/p>\n \u201cIt\u2019s complicated, but my suspicion would be that putting more energy in Pennsylvania is ultimately going to be good for Pennsylvanians,\u201d Peskoe said.<\/p>\n But another complication is that grid operator PJM recently informed Constellation<\/a> it would have to wait until 2031 to restart the nuclear power plant. That was due in large part to delays in the construction of new transmission lines \u201cas far away as southern Virginia and West Virginia,\u201d according to FERC filings.<\/p>\n That raises the question of when the Microsoft-Constellation deal would bring relief to ratepayers, and whether the project could ultimately add to energy bills via transmission costs.<\/p>\n An initial PJM analysis<\/a> of the Three Mile Island restart shows Constellation will be on the hook for about $97 million in infrastructure costs, including to string new high-voltage wires along the Susquehanna River in South Central Pennsylvania, a project currently undergoing state-level review<\/a> for wetland impacts.<\/p>\n But the PJM report shows the plant will also rely on publicly financed projects in surrounding states, such as high-voltage transmission lines that are part of larger, multibillion-dollar grid upgrade plans. The bill for much of that could find its way to consumers: In Maryland, the state Office of People\u2019s Counsel has filed a federal complaint<\/a> that $1.6 billion in \u201cdata-center transmission costs\u201d will be paid by its residents over the next 10 years.<\/p>\n Pennsylvanians are already up in arms over a similar project, a 222-mile, high-voltage \u201cKammer-Juniata\u201d transmission line running from a location near Three Mile Island to West Virginia. That\u2019s now being opposed by both the PUC and consumer advocates over fears that costs will be pushed onto Pennsylvania ratepayers.\u00a0<\/p>\n PJM already approved the project in February, but the PUC and Pennsylvania Office of Consumer Advocate have both asked the grid operator to withhold financial incentives<\/a>, noting the Crane power plant has yet to receive necessary state-level reviews, including for the withdrawal<\/a> of up to 73 million gallons of water a day from the Susquehanna River to operate.<\/p>\n It can be hard to calculate how much any individual data center or new power source is contributing to the need to build such expensive transmission projects. Constellation, for its part, did not respond to a question asking who will pay for any such infrastructure the nuclear plant reopening requires.\u00a0<\/p>\n But the cost for many grid upgrades is ultimately borne by consumers, Quigley said. Transmission expenses are approaching 35 percent of electricity bills within PJM, which approved another $12 billion<\/a> in infrastructure projects in February, he noted.<\/p>\n \u201cIt\u2019s basically all to serve data centers,\u201d Quigley said.\u00a0<\/p>\n Power Plays<\/strong><\/p>\n In its new GRID white paper, Shapiro\u2019s office says it has accounted for the numerous challenges in getting data center policy right\u2014from hidden costs to climate considerations.<\/p>\n For example, on May 13, the state\u2019s Public Utility Commission released an anticipated \u201cmodel tariff<\/a>\u201d on data centers, essentially a set of new rules that the agency suggests electric utilities across the state adopt to ensure consumers don\u2019t shoulder the costs for data center development.\u00a0<\/p>\n Shapiro recently butted heads<\/a> with the independent PUC as he used his bully pulpit to lean into its territory of utility regulation. But in the GRID details released Wednesday, Shapiro\u2019s office said it would now lean on the commission\u2019s model tariff: If a data center developer meets the PUC\u2019s recommendations for paying for transmission costs, that would also check the box for the governor\u2019s GRID standards.<\/p>\n But how much power Shapiro and the PUC ultimately have to coerce utilities and data centers is another question. On its own, Shapiro\u2019s office has just one carrot to dangle: continued access to a \u201cFast Track<\/a>\u201d permitting program that several early data center developers in Pennsylvania utilized. But developers are not required to use it to build.<\/p>\n Similarly, the PUC by statute cannot require utilities to adopt a model tariff. That puts significant focus on Pennsylvania\u2019s divided legislature, where the Democratically controlled House and Republican-controlled Senate have agreed on scant energy policy in recent years.\u00a0<\/p>\n Members of both parties have introduced data center legislation this year. Notably, House Bill 1834<\/a>, introduced by Democratic Rep. Robert Matzie, would implement regulation via the PUC and has both BYOE and clean-energy provisions.<\/p>\n Shapiro\u2019s office referred directly to the bill in its Wednesday release, noting it had adopted its policy preferences for \u201cclean, firm\u201d energy. His office is also calling for new legislation to change a valuable tax exemption for the industry\u2014estimated at more than $517 million annually by 2030\u2014to require that recipients meet GRID standards.<\/p>\n But the governor\u2019s office has yet to reveal how his administration is working to build policy consensus in the legislature. And numerous legislative offices, including Matzie\u2019s, did not respond to interview requests.\u00a0<\/p>\n Matzie\u2019s bill, which passed the House in March, has been sitting in a Senate committee ever since, and Senate Republican Majority Leader Joe Pittman recently told a reporter<\/a> he had no plans to move data center legislation.<\/p>\n Adding to the challenge, the Pennsylvania Utility Law Project\u2019s Marx notes, is that FERC and PJM remain outside the reach of state lawmakers, with the exception of Shapiro\u2019s musing over an unprecedented exit<\/a> from the grid operator and legal action, including a successful 2024 lawsuit<\/a> against PJM over cost increases.<\/p>\n \u201cWhat\u2019s a little confounding is that a lot of the pieces of the regulatory puzzle for data centers are decided at PJM and FERC \u2026 mainly things that impact interstate commerce and transmission lines,\u201d Marx said.<\/p>\n NRDC\u2019s Lang-Ree notes that PJM has proposed requiring data centers<\/a> to either provide new energy generation or get kicked to the back of the line when supply runs tight and blackouts loom. But she added that PJM would still rely on state regulators<\/a> to identify noncompliance and keep costs from shifting to consumers.<\/p>\n Quigley said that underscores the complexity of getting the policy right.<\/p>\n \u201cNobody has all the marbles here,\u201d he said.<\/p>\n \t\t\t\t\tAbout This Story<\/p>\n Perhaps you noticed: This story, like all the news we publish, is free to read. That\u2019s because Inside Climate News is a 501c3 nonprofit organization. We do not charge a subscription fee, lock our news behind a paywall, or clutter our website with ads. We make our news on climate and the environment freely available to you and anyone who wants it.<\/p>\n That\u2019s not all. We also share our news for free with scores of other media organizations around the country. Many of them can\u2019t afford to do environmental journalism of their own. We\u2019ve built bureaus from coast to coast to report local stories, collaborate with local newsrooms and co-publish articles so that this vital work is shared as widely as possible.<\/p>\n Two of us launched ICN in 2007. Six years later we earned a Pulitzer Prize for National Reporting, and now we run the oldest and largest dedicated climate newsroom in the nation. We tell the story in all its complexity. We hold polluters accountable. We expose environmental injustice. We debunk misinformation. We scrutinize solutions and inspire action.<\/p>\n Donations from readers like you fund every aspect of what we do. If you don\u2019t already, will you support our ongoing work, our reporting on the biggest crisis facing our planet, and help us reach even more readers in more places? <\/p>\n Please take a moment to make a tax-deductible donation. Every one of them makes a difference.<\/p>\n Thank you,<\/p>\n![\"The](\"https:\/\/www.europesays.com\/us\/wp-content\/uploads\/2026\/05\/GettyImages-2244492438-1024x683.jpg\"\/)
The construction site of an Amazon Web Services data center in Salem Township, Pa., on Oct. 10, 2025. Credit: Jason Ardan\/Citizens\u2019 Voice via Getty Images<\/p>\n\n
![\"Power](\"https:\/\/www.europesays.com\/us\/wp-content\/uploads\/2026\/05\/three-mile-island_andrew-caballero-reynolds-afp-getty-scaled.jpg\"\/)
The Three Mile Island nuclear plant operates on March 26, 2019, in Middletown, Pa. Credit: Andrew Caballero-Reynolds\/AFP via Getty Images<\/p>\n![\"Transmission](\"https:\/\/www.europesays.com\/us\/wp-content\/uploads\/2026\/05\/GettyImages-2147871129-1024x683.jpg\"\/)
Transmission lines connect to a substation in Mount Morris, Pa. Credit: Salwan Georges\/The Washington Post via Getty Images<\/p>\n![\"Gov.](\"https:\/\/www.europesays.com\/us\/wp-content\/uploads\/2026\/05\/Shapiro-Data-Center_w.jpg\"\/)
Gov. Josh Shapiro delivers remarks at the site of a future Amazon data center on Aug. 7, 2025, in Falls Township, Pa. Credit: Commonwealth of Pennsylvania<\/p>\n