Pennsylvania is well positioned to become a leading state in the new frontier of artificial intelligence. The world’s largest technology companies have committed more than $90 billion in capital investments to projects to be located in Pennsylvania.
But these companies move at the speed of business. They will have little patience to deal with the deadly combination of Pennsylvania’s regulatory bureaucracy and the radical environmentalism that has derailed previous efforts.
Proposals have already been made for the establishment of new data centers – the computing capacity that fuels the AI revolution. But challenges are already emerging. State policymakers are considering new laws and regulations. At a local level, NIMBYism (Not In My Back Yard) has emerged.
In fact, taxpayers should welcome the development of data centers. Such centers create both construction and ongoing operations jobs. There is little demand for municipal services. They pay property taxes to the local school districts, while no students are added to the schools.
Data centers consume enormous amounts of electricity. Radical greens are fueling concerns, claiming this consumption will lead to higher electricity costs for homes. The line of attack is gaining traction as consumer electricity bills are already rising. But electricity costs are skyrocketing as so-called ‘renewable’ energy sources have proven expensive and unreliable.
At the same time, the extreme environmental left has launched an all-out attack on the development of any energy source. They have been particularly aggressive in opposing further development of carbon-based energy – the very energy that Pennsylvania has in abundance.
Carl Marrara of the Pennsylvania Manufacturers Association stopped worrying about the lack of energy supply, arguing:
“Pennsylvania has all the energy it could ever need. On top of 214 trillion cubic feet of recoverable natural gas, the state should be leading the way in cheap, reliable energy. Instead of controlling our energy industry, we should be expanding natural gas-fired power plants, ramping up combined heat and power systems, and getting a Liquefied Natural Gas (LNG) export facility up and running…”
The main obstacle to unlocking that energy potential is the multi-state Regional Greenhouse Gas Initiative (RGGI). Marrara points out that between 2010 and 2019, “12 natural gas-fired plants came online in Pennsylvania, adding nearly 11 gigawatts of power.” When former Democratic Gov. Tom Wolf drew Pennsylvania into the RGGI, this development virtually came to a halt.
Governor Josh Shapiro continued to support Pennsylvania’s participation in the RGGI until he needed a bargaining chip to break the recent state budget stalemate. He agreed to withdraw from the RGGI in exchange for legislative approval of his state’s spending priorities.
But that doesn’t mean the radical greens have surrendered and gone home. Shapiro has put forward his own plans, called PACER and PRESS, that would double the requirements for expensive “renewables” and/or non-existent energy sources while creating roadblocks and taxes on carbon-based energy.
And again, lawmakers are proposing a so-called “severance tax” on natural gas produced in Pennsylvania. That worn-out old proposal has been tabled by the left since production began in the Marcellus Shale region. Gas producers already pay an impact fee, a severance tax by another name. What lawmakers are trying to do is double tax producers in an effort to make natural gas uncompetitive as an energy source.
The bottom line is that Pennsylvania is fully capable of providing all the energy needed for data centers and related facilities if we ignore its failed, ideologically driven energy policies. As logical as that is, it is politically difficult. Shapiro is preparing for the presidency and must therefore give in to the environmental extremists in his party. He will continue to fight for policies that slow energy development and drive up consumer prices.
Radical environmentalists and their allies in the traditional news media will continue to fuel the false claim that data centers, rather than government policy failures, are responsible for rising electricity costs. The fact is that Pennsylvania is capable of producing more than enough affordable electricity for both data centers and consumers.
The solution does not lie in building fewer data centers, but in producing more electricity.
Lowman S. Henry is president and CEO of the Lincoln Institute and host of the weekly American Radio Journal and Lincoln Radio Journal. His email address is [email protected].
