October 16， 2025
Pennsylvania is positioning itself as a rising contender in the competitive race for AI data centers, pursuing an ambitious $70 billion initiative to attract major investments and transform its economic landscape. The comprehensive plan, announced in July at the Pennsylvania Energy and Innovation Summit held at Carnegie Mellon University in Pittsburgh, relies entirely on state-level coordination and private investment rather than federal backing. This initiative supports a wide range of projects tied to data center operations, with a notable focus on supplying energy, enhancing the power grid, and training workers, while direct investments in the data centers themselves constitute a smaller portion of the overall strategy. The majority of projects aim to improve power delivery, a critical area that has previously bottlenecked data center expansion and construction.
Central to Pennsylvania's strategy is its formidable energy advantage. The state is rich in coal and natural gas, with natural gas standing as the largest source of in-state electricity generation according to the US Energy Information Administration. Its location atop the Appalachian Basin, home to some of the nation’s richest shale gas reservoirs, further strengthens this profile, making Pennsylvania the second-largest natural gas producer in the United States and the third-largest coal-producing state. These abundant resources position it as a prime location for power-hungry AI data centers, which require far more electricity than traditional facilities due to their dependence on GPUs and advanced computing systems.
This energy potential has already attracted significant commitments from major technology companies and investors. Among the most ambitious projects is the $25 billion conversion of an abandoned Aliquippa steel mill into a high-density data center complex, backed by investment giant Blackstone. In a series of other high-value developments, CoreWeave announced a $6 billion investment for a data center in Lancaster, and Energy Capital Partners revealed a $5 billion plan for a facility in Delta. Google has committed to a 20-year deal to repower two Pennsylvania hydropower facilities, securing 670 MW of power generation. Meanwhile, a $15 billion plan was revealed to develop a three-campus data center hub near Carlisle with a total capacity of 1.3 GW. Beyond pure infrastructure, the initiative includes workforce development through the Energy Innovation Center Infrastructure Academy and a $2.5 million investment from Meta to support rural startups.
Industry analysts view Pennsylvania’s coordinated approach as game-changing. “Many states like Virginia, Oregon, and Texas have created incentive programs, but the number of recent announcements in Pennsylvania … is unprecedented,” said Alvin Nguyen, Senior Analyst with Forrester Research. He highlighted the state's ample land, abundant water, and skilled workforce as key advantages, noting that “Pennsylvania’s push can definitely take away business from Northern Virginia and other existing data center markets.” This represents a dramatic shift for a state once overlooked by the industry. Bob Ricci, President of Electrical Equipment at Mission Critical Group, explained that high utility costs were once a deterrent, but “recently, because of the amount of natural gas and utility available in the state, it's become sort of a statewide effort to … develop data centers,” a push with bipartisan appeal for job creation.
Data center operators are particularly enthusiastic about the benefits of state-level support. Joe Minarik, COO of DataBank, emphasized how a statewide effort simplifies the typically complex process of securing incentives and navigating regulatory hurdles. “When you have the state backing it, it really helps get through those regulatory hurdles a lot better,” Minarik said, while also stressing the need for collaboration with local municipalities. He praised Pennsylvania’s model, concluding, “I like the idea of what they're doing. I think it'll bring a lot of ease of doing business through efforts for the local government,” signaling a powerful new chapter for the state's economic future.
SOURCE Canalys
