The rapid expansion of data centers across the United States has prompted state officials and consumer advocates to push for facilities to develop their own power generation rather than drawing from public electricity grids. Pennsylvania Governor Josh Shapiro announced a moratorium on artificial intelligence data centers that do not provide their own power infrastructure, while Texas Governor Greg Abbott blocked new data centers from connecting to the state’s electrical system. Proponents of this approach argue that independent power generation would shield utility ratepayers from increased costs associated with data center operations.
However, the shift toward standalone power plants has created regulatory complications. The Environmental Protection Agency released guidance last month stating that the Acid Rain Program, a key component of the Clean Air Act designed to monitor sulfur dioxide and nitrogen oxide emissions from large power plants, does not apply to facilities disconnected from the electricity grid. The Acid Rain Program, established in 1990, has successfully reduced emissions from power generation facilities through continuous monitoring and reporting requirements. Experts note that eliminating this oversight removes one of the most reliable tools available to state and local regulators for assessing environmental impacts from new power plants serving data centers.
Multiple large-scale projects illustrate the scale of the development surge. OpenAI has announced plans for a 9.2-gigawatt natural gas facility in Ohio, while Amazon is planning a 7.65-gigawatt gas plant in Texas. Nexus has proposed a 6-gigawatt facility, and smaller installations are being developed across the country. The EPA characterized its guidance as expanding opportunities for companies while protecting the environment, though the agency also proposed a more formal rule change to further streamline permitting processes for data centers and associated power infrastructure.
Environmental law experts emphasize that the responsibility for ensuring adequate environmental protections now falls primarily to state agencies and local regulators, who retain authority to impose requirements beyond federal minimums. The permitting decisions ultimately rest with state environmental authorities overseeing these projects.
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