(The Center Square) – The Pennsylvania Senate is the next stop for a proposed set of rules on the development of data centers following a feisty debate in the state House that got into green energy requirements, concerns about local control, and Pennsylvania’s membership in the 13-state PJM Interconnection power grid organization.
“This is one of the biggest topics of the moment,” said Democratic Rep. Robert Matzie of Beaver County, the prime sponsor. He said he wants to make sure data centers do not impose new costs on electricity ratepayers.
“Here is your chance to do something,” Matzie told House colleagues before the Tuesday vote in the Democratic-dominated chamber.
It was not immediately clear which committee in the Republican-dominated Senate would receive the bill as “affordability” continues to be a prominent theme among lawmakers. On Wednesday, House Republicans at a press conference announced a new set of proposals for suspensions, reductions, or “holidays” on various taxes.
Neither chamber had previously passed a set of rules on data centers.
Democratic Sen. Lisa Boscola, minority chair of the Senate Consumer Protection & Professional Licensure Committee, called the House action a “good start” but said the bill probably would be changed as it moved forward.
Some members of her own party, Boscola said, think there should be a moratorium on data center construction. Her own opinion is that data centers are needed, and she has pitched ideas, including charging an “impact fee” to benefit communities affected by the projects.
“This is a complex issue, and at least they are moving something,” Boscola said of the House action.
The Matzie bill gives a laundry list of data center responsibilities to the state Public Utility Commission. Those include having the PUC set up data center regulations intended to prevent cost-shifting to existing electricity customers; obtaining security deposits from data centers; and requiring them to get increasing amounts of their electricity from “clean energy” sources.
Those would include nuclear, solar, battery storage and hydrogen-fueled energy generation.
The requirements drew an avalanche of criticism from House Republicans.
“A very slippery slope” is how Republican Rep. Jamie Walsh of Luzerne County described the bill’s reliance on the PUC, which he said could end up getting control of data center siting decisions. Similarly, Republican Rep. Robert Leadbeter of Columbia County said it “begins a process of eroding local municipal authority.”
And Republican Rep. Jeremy Shaffer of Allegheny County said the real solution to the data center challenge was pulling the state out of PJM, or else reforming the organization that oversees wholesale electricity movement in 13 states and the District of Columbia.
The vote to approve the bill was 104-95. Two Bucks County Republicans – Reps. Joe Hogan and Kathleen Tomlinson – joined all Democrats in casting votes in favor.
The new affordability proposals from House Republicans were part of a package dubbed “Freedom Through Affordability” and unveiled at a press conference led by Rep. David Rowe of Union County.
Rowe said “putting money back into the pockets of Pennsylvanians” was vital, so he was proposing a temporary, six-month reduction in the state personal income tax from 3.07% to 2.99%.
Among the other proposals, Rep. Kristin Marcell of Bucks County said she and Rep. Eric Davanzo of Westmoreland County plan to propose a temporary suspension of the gross receipts tax on cell phone use and electricity. And Republican Rep. Abby Major of Armstrong County said she wants to suspend the state gas tax for six months starting June 1.
Pennsylvania’s current tax is 57.6 cents per gallon, the fourth-highest rate in the nation. In the Senate, Boscola has already pitched a 60-day gas tax suspension.
