Pennsylvania Governor Josh Shapiro Criticizes AI Data Center Developers Amid New State Regulations

Pennsylvania Governor Josh Shapiro expressed sharp criticism on Tuesday regarding artificial intelligence data center developers, asserting that a significant portion of firms show disregard for host municipalities. Appearing on CNBC's "Squawk on the Street," in an interview first reported by CNBC Business, the Democratic governor emphasized that the state only intends to partner with technology operators willing to collaborate constructively with local leadership.

Shapiro's remarks come amid a national political debate over the rapid expansion of energy-intensive computing infrastructure required for AI training and operation. His statements directly countered comments made a day prior by President Donald Trump, who argued that communities resisting AI facility construction risk economic stagnation. Speaking alongside Chobani CEO Hamdi Ulukaya—who was announcing a $1.2 billion dairy manufacturing hub in Pennsylvania's Lehigh Valley—Shapiro stated that Pennsylvania demands corporate leaders who demonstrate genuine commitment to host municipalities rather than attempting to force projects through without local buy-in.

To enforce these standards, Shapiro signed an executive order on Aug. 18 imposing strict state regulations on upcoming facilities. Under the Governor's Responsible Infrastructure Development (GRID) Requirements, artificial intelligence data center initiatives were removed from the state's expedited permitting program. The directive mandates that project sponsors secure local municipal backing before applying for state approvals, generate and fund their own electric power without shifting utility costs to residential or commercial ratepayers, and ensure robust safeguards for local air quality and water resources.

The administrative friction in Pennsylvania reflects rising public pushback against large-scale computing infrastructure. Opponents of the facilities frequently express concern over elevated electricity demand, rising utility bills, and potential strains on local water supplies. According to a Gallup poll released in May, roughly seven out of ten Americans oppose the construction of AI data centers in their immediate communities. Furthermore, an August memo from the National Republican Senatorial Committee cautioned that voter opposition to data center builds was putting Republican Senator Jon Husted of Ohio at political risk in his special election against Democratic contender Sherrod Brown.

The issue has also become a central topic in Pennsylvania's gubernatorial race, where Shapiro faces a re-election challenge from Republican state Treasurer Stacy Garrity. In response to Shapiro's executive order, Garrity published a video characterizing the governor's directive as policy "damage control." She noted that Shapiro had previously celebrated major infrastructure commitments, including Amazon’s June 2025 pledge to invest at least $20 billion across two data center complexes in the state. At the time of Amazon's announcement, Shapiro praised the deal on CNBC as a landmark achievement that would help secure American AI leadership. While Garrity now advocates for a temporary pause on state data center development, her opponents pointed to radio interviews from the previous year in which she lamented that neighboring Ohio was significantly outstripping Pennsylvania in facility counts.

Industry proponents, however, maintain that public skepticism can be resolved through clearer communication regarding technological and economic benefits. Speaking later Tuesday on CNBC, David Sacks, co-chair of the President's Council of Advisors on Science & Technology, argued that data center operators can structure agreements that ultimately lower residential energy expenses. Sacks pointed out that developers frequently finance electrical grid infrastructure upgrades and utilize closed-loop water recirculation systems to minimize environmental impact, asserting that public sentiment shifts favorably once voters understand these mitigation measures.