Pennsylvania Governor Josh Shapiro signed an executive order to curb the growth of AI data centers in his state, which mandates four minimum standards. It requires companies to pay for their own energy, minimize noise, air pollution, and water use, hire local workers, and give back to communities through negotiated benefit agreements. Developers must sign a legally binding order to that effect. If the municipality does not formally agree to all those standards, the state will back the town in blocking the data center. Earlier, Shapiro encouraged data center development, but now claims he flip-flopped because of concerns from Pennsylvania residents.
NBC reports that Shapiro is removing all data center projects from his state’s fast-track permitting program, and going forward, they would be ineligible for those measures. He also said nondisclosure agreements for data center projects will not be allowed in the state under his new order. Opponents have raised concerns about rising electricity bills, environmental impacts, and fears about the growth of AI technology, among other issues. According to Shapiro, there are only about five projects that have even received permits to go forward, but there are “100 projects or so that are wreaking havoc on our communities that are never going to be built.”
In western Pennsylvania, a Las Vegas developer wants to convert an abandoned 400-acre former racetrack in Big Beaver into a three-building, 600,000-square-foot data center complex. But neighbors oppose it, concerned about noise, pollution, water use, and rising electric bills. The borough planning committee will hold its first review of the application from Switch Data Centers later this month, but towns like Big Beaver are rushing to write data center ordinances. With Shapiro’s executive order, residents would now have the power to stop or modify the projects.
While Shapiro is still allowing data centers under strict rules, New York Governor Kathy Hochul signed a one-year moratorium on data center development, and Texas Governor Greg Abbott paused data center projects, pending an audit.
To address rising electric bills, President Trump has promoted the “Ratepayer Protection Pledge,” in which developers who sign on fund the cost of increased power generation and infrastructure for the developments. President Trump has touted the benefits of data center development, including potential job growth, increased tax revenue for localities that accept the developments, and potential property tax cuts, among other incentives. Leaders have also argued that environmental concerns have been overblown or are based on faulty data.
Virginia, known as Data Center Alley, has the most data centers of any state. Loudoun County, home to about 250 data centers, is also one of the wealthiest counties in the country, where the typical homeowner receives roughly $5,800 a year in tax benefits from lower rates tied to data centers that now supply roughly half of the county’s property tax revenue. According to county officials, for every dollar data centers consume in county services, the county gets back $26 in tax revenue. Property taxes on data centers and a tax on their computer equipment are expected to generate $1.3 billion next year, accounting for 40% of the county’s total tax revenue, according to the county’s 2027 fiscal year budget. Those data centers have also helped pay for a $102 million recreation center with multiple pools and hydro-massage chairs; a $22 million conversion of former President James Monroe’s estate into a park; and the construction of two new schools with a third on the way; the expansion of fire and emergency services, roads, bridges and recreational facilities; and 15,000 jobs.
The opposition to data centers is fueled by misinformation, much of it spread by China, which is in a race with the United States to lead the industry, which America needs to win for national security reasons. Data centers also enable Instagram and Waze, streaming movies, online banking, hailing an Uber, and conversing with A.I. chatbots, among many other future uses that could open frontiers in defense and medicine. As of April, there were more than 3,000 operational data centers in the United States with more than 1,500 new centers in development. McKinsey predicts that by 2030, data centers worldwide will require nearly $7 trillion in capital outlays to meet the demands for computer power.
Job opportunities abound around data centers. For example, according to an opinion piece in the N.Y. Times, a decade ago, members of the International Brotherhood of Electrical Workers Local 26 in the Washington, D.C., region worked about 14 million hours annually. In 2025, they worked 28 million hours and will likely top 33 million hours this year with good-paying jobs. Job growth occurred because of growth in data centers in Northern Virginia, with associated jobs in construction and maintenance. Data centers are not single projects; they are built in phases over years and continually upgraded, expanded, reconfigured, and maintained as technology evolves, creating steady, local, long-term employment.
Conclusion
Pennsylvania became the latest state to clamp down on data center development, but unlike New York and Texas, it did not impose a moratorium or pause; instead, it mandated strict rules to follow. Pennsylvania Governor Shapiro said he did so because residents worry about noise, water use, and rising electric bills. Misinformation about data centers has raised concerns among Americans, but benefits also exist, including job growth, increased tax revenue, and property tax cuts, among other incentives. Loudon County, Virginia, is an example of a wealthy area reaping huge benefits. Property taxes on data centers and a tax on their computer equipment are expected to generate $1.3 billion next year, accounting for 40% of the county’s total tax revenue.
