Pennsylvania Data Centers: Eight GRID Questions
A focused guide to DEP review tracks, backup generation, air monitoring and reporting under Executive Order 2026-05 and Act 21 of 2026
Regulatory information reviewed September 18, 2026.
Key Takeaways
For DEP permit or authorization applications submitted after August 18, 2026, data center projects with peak demand over 25 MW face two review tracks. Signing a GRID consent agreement enables rolling review; nonsigners face additional prerequisites. Separately, applicants for tax-program certification must submit an executed GRID agreement under the Department of Revenue’s August 2026 guidelines.
DEP's template addresses backup emissions, at least three continuous air monitors with public data, and third-party-verified reporting. These are selected terms within a broader agreement; the executed project-specific consent order controls.
Act 21 of 2026 separately requires operating data centers with peak electric demand of 10 MW or greater to report energy and water consumption by July 1, 2027, and annually thereafter. Reporting noncompliance carries a $10,000-per-day civil penalty until submission.
On August 18, 2026, Governor Shapiro signed Executive Order 2026-05, published September 5, 2026, at 56 Pa.B. 5898 and codified at 4 Pa. Code §§ 7.1081 to 7.1089. Effective immediately, the order integrates the Governor's Responsible Infrastructure Development (GRID) Requirements into DEP's permitting process.
For covered DEP applications, executing a project-specific Consent Order and Agreement (COA) determines the review track. DEP’s template, revised August 18, 2026, addresses energy, community and workforce commitments as well as environmental obligations. It allows changes for project-specific facts. The discussion below describes selected template provisions; the executed agreement controls each project’s obligations.
Act 21 of 2026 (SB 146, approved July 12, 2026) added Subarticle B to Article XVIII-B of the Fiscal Code, establishing annual energy and water reporting for qualifying data centers at 10 MW or greater. Separately, the executive order directs DEP to examine potential changes to generator regulations without setting a deadline for that examination.
These eight questions focus on selected permitting, backup-generation, air-monitoring and reporting issues. They are not a complete GRID compliance checklist. Evaluate the full executed agreement, tax-program requirements and applicable air and water permits together.
1. Will peak demand exceed 25 MW?
Section 7.1082(a) sets the peak-demand threshold for the special DEP review process at over 25 MW. The two tracks in § 7.1082(b) and (c) apply to DEP permit or authorization applications submitted after the order’s effective date for projects above that threshold. This is a project electricity-demand threshold, not a general threshold for needing an air permit.
At 25 MW or less, these two special review tracks do not apply. Ordinary air and other environmental authorizations may still be required. Section 7.1082(e) excludes data center projects from the PA Permit Fast Track Program regardless of size. Separately, Act 21 reporting reaches qualifying operating facilities at 10 MW or greater, and tax-program certification has its own GRID requirement. Establish the project’s peak demand and anticipated expansion before evaluating applicability.
Confirm the air-permitting authority.
DEP directs air-permit applicants in Allegheny County and Philadelphia to the Allegheny County Health Department and Philadelphia Air Management Services, respectively.
Evaluate those local requirements alongside applicable DEP authorizations and GRID obligations.
2. Will you sign the GRID consent order?
Executing the consent order is required for the rolling-review track; the order also provides a nonsigner track. Under § 7.1082(b)(1), before submitting new applications, a participating developer must notify DEP of its intent, meet with DEP about the permits and local approvals, and execute a project-specific consent order based on the template.
Under § 7.1082(b)(2), DEP reviews applications on a rolling basis. It may issue qualifying permits on that basis only after receiving documentation of consistency with the local comprehensive plan and all applicable local subdivision and zoning approvals. The Payback and Permit Decision Guarantee processing timelines begin only after the required local-approval documentation is received. Signing does not guarantee permit approval.
Signing also matters outside these DEP review tracks. Section II of the Department of Revenue’s August 2026 tax-program guidelines requires applicants for Computer Data Center Equipment Exemption Program certification, as of August 18, 2026, to include an executed DEP consent agreement implementing GRID. That application requirement has no stated 25 MW cutoff. Evaluate certification and exemption eligibility separately from the DEP review-track threshold; a smaller project should not assume it is outside GRID for tax-program purposes.
3. What happens if you do not sign?
Section 7.1082(c) establishes the nonsigner track. DEP does not begin review until the applicant documents local comprehensive-plan consistency, all applicable subdivision and zoning approvals, and any required water-withdrawal or wastewater-discharge authorizations. DEP does not issue permits on a rolling basis and cannot issue them until all necessary applications have been received and reviewed. These applications are excluded from PAyback and the Permit Decision Guarantee.
Schedule the complete DEP permit package and its prerequisites together. A nonsigner review track does not satisfy the separate executed-agreement requirement for tax-program certification described above.
4. Does your backup system meet the template emissions terms?
Paragraph 6.b of the template provides for zero-emission energy generation and storage or backup generators with emissions no greater than those achieved by a Tier 4 or Tier 4 equivalent generator. It also calls for reduced runtime and limits backup generation to emergencies and limited testing and maintenance consistent with federal and state air requirements.
Paragraph 3.z defines Tier 4 equivalent as an engine-generator set equipped with selective catalytic reduction (SCR) or equivalent nitrogen oxides (NOx) control, a diesel oxidation catalyst (DOC) or equivalent carbon monoxide (CO) control, and a diesel particulate filter (DPF) or equivalent particulate matter (PM) control. This template definition is not an EPA certification. A Tier 4-certified unit need not use that exact hardware; confirm its certification and permit-specific emission limits.
For comparison, Virginia’s APG-576 provides presumptive controls for diesel engine-generator sets at data centers for applications submitted on or after July 1, 2026. It retains case-by-case best available control technology (BACT) review and specified exceptions for certain backup roles and existing-unit modifications. Its boilerplate does not cover Prevention of Significant Deterioration (PSD) or nonattainment permit review. It is a separate permitting framework, not Pennsylvania’s GRID standard.
Compliance demonstrations depend on engine type, certification, configuration and permit conditions. For stationary compression-ignition engines, evaluate 40 CFR Part 60, Subpart IIII, including § 60.4211. For spark-ignition engines, evaluate Subpart JJJJ. Assess applicable Part 63, Subpart ZZZZ requirements or exemptions separately. Federal rules allow certification-based compliance for certain engines and require performance testing in other circumstances; permits can add requirements. EPA’s stationary-engine compliance guidance distinguishes these categories.
Determine whether source testing is required for the actual fleet and permit. Assess source-wide potential emissions, relevant source-aggregation rules and any required air-quality modeling; Tier 4 performance alone does not establish that a project satisfies all air-permitting requirements. Plan maintenance and readiness testing within all governing federal, state, local, permit and agreement limits. Identify startup-triggered obligations before commissioning.
5. Have you planned at least three continuous air monitors?
Paragraph 6.c of the template calls for at least three continuous air quality monitors at or near the site in DEP-approved locations. Collected data must be made available to the public and the relevant municipal and county governments.
The template calls for an Air Monitor Plan at least [60] days before commercial operation; the bracketed value is subject to project-specific completion. The plan identifies proposed locations, parameters, installation schedule and data-publication arrangements. It provides for installation no later than 180 days after commercial operation begins. Confirm the final deadlines in the executed consent order.
Select pollutants, measurement methods and locations for the site’s emissions, meteorology, nearby receptors and monitoring objectives, subject to DEP approval. For assessments involving ambient air standards, consider PM2.5, PM10 and nitrogen dioxide (NO2), with NO/NOx and meteorological measurements where useful. EPA’s ambient standards distinguish NO2 from total NOx. These are site-specific recommendations, not a fixed GRID monitoring package. SCR reduces NOx; controlled engines still warrant evaluation.
Use a documented quality-assurance plan with appropriate calibration, data validation, completeness objectives and public-reporting procedures. Ambient monitoring, stack testing and dispersion modeling answer different questions; a monitoring network does not automatically satisfy a required permitting demonstration. Interpret measurements with background conditions and operating records before attributing concentrations to the facility.
6. Will your verified report be submitted at least 30 days before commercial operation?
Paragraph 7.a calls for a third-party-verified report at least 30 days before commercial operation. It identifies material changes in the developer’s performance of obligations in paragraphs 4 through 6 and includes confirmations concerning ratepayer costs, community outreach, investment and jobs required to date, and environmental compliance status.
Paragraph 7.b separately calls for an annual third-party-verified report by July 1. It documents continued compliance with the energy and community/workforce obligations in paragraphs 4 and 5, the amount and source of water used, and electricity use. It also requires certification that water use has not adversely affected the quantity or quality of water for other uses or users, including designated and existing uses under 25 Pa. Code Chapter 93. This annual report does not expressly repeat every paragraph 6 environmental obligation; those obligations still apply according to their terms.
The verifier descriptions in paragraph 7 are bracketed for project-specific completion. Arrange appropriately qualified verification for the full report scope. Paragraphs 7.c and 7.d address inclusion of these reporting obligations in individual permit or authorization applications under the Air Pollution Control Act, Clean Streams Law and Dam Safety and Encroachments Act, and bar challenges to their inclusion as permit conditions.
Paragraph 10 provides stipulated civil penalties in addition to other applicable remedies: generally $25,000 per day for each violation, with a separate bracketed rate of $25,000 to $100,000 per MW of rated capacity, per day, for each paragraph 4 energy-obligation violation. Confirm the rate and terms in the executed agreement. These are distinct from Act 21’s reporting penalty.
7. Is peak demand 10 MW or more?
This reporting requirement includes existing operating facilities. Section 1812-B defines a qualifying data center as a facility, campus or interconnected array predominantly housing working servers or similar data storage systems with peak electric demand of at least 10 MW. Section 1813-B requires reports to DEP on the preceding calendar year's consumption by July 1, 2027, and each July 1 thereafter.
The statutory report includes monthly energy and water consumption, peak-load energy use, maximum daily water demand, efficiency measures, generation, waste-heat recovery, projected demand and water-protection measures. Section 7.1083(c) of the executive order also specifies parent-company identity, monthly natural-gas consumption, air-protection measures, generation quantities and public-water-system agreements. Its peak-load energy metric uses MWh; the statute uses kWh.
Use DEP’s required reporting format and units, reconciling conversions as needed. Section 1816-B provides a $10,000-per-day civil penalty for reporting noncompliance until submission. Proprietary information is protected; aggregated and anonymized data is public.
8. Are you counting on today's generator rules?
Section 7.1085(a) directs DEP to examine whether generator regulations should require different technologies or emissions controls, more fully consider cumulative impacts at a facility or nearby facilities, or address generators deployed as grid resources. DEP must recommend any new regulations it identifies as necessary to address impacts unique to data center development and operation.
The order sets no deadline for that examination and does not itself enact those future controls or authorize grid-service operation. Apply current engine classifications, operating restrictions and permit conditions. Evaluate any proposed grid-support operation against the specific federal and state rules, orders, permits and agreement terms that govern it.
What Sustained Compliance Requires
Build a schedule that distinguishes permit and initial-startup obligations from the template’s commercial-operation milestones. Confirm all deadlines, verification requirements and operating conditions in the executed agreement and permits before selecting equipment or committing to an operating schedule.
Establish peak demand; evaluate the over-25 MW threshold for the special DEP review tracks, the at-least-10 MW reporting threshold and the separate tax-program certification requirement. Identify the air-permitting authority and schedule local approvals.
Evaluate the full generator fleet, applicable engine rules, emissions and required permitting demonstrations. Select compliant equipment and plan source testing where required, along with maintenance and operating records.
Develop a site-specific Air Monitor Plan for DEP review, including measurement methods, locations, quality assurance and public reporting. Coordinate the pre-operation report, annual COA report and statutory consumption report as distinct obligations.
Alliance Technical Group provides data center generator and stack testing, environmental consulting, and ambient and fenceline monitoring. Our team can help scope the applicable permitting, testing and monitoring work early in project development.
