Massachusetts Governor mandates local approval for data centers

Massachusetts Governor Maura Healey has signed an executive order requiring proposed data center projects to obtain local approval before they can proceed with state permitting. The order aims to ensure that developers strike community benefits agreements that align with state standards regarding public health, the environment, and infrastructure.

Under the new framework, data centers with a peak electricity demand exceeding 25 megawatts must demonstrate compliance with state guidelines. These guidelines include the expectation that facilities procure or develop their own clean energy resources to avoid straining the electric grid or increasing costs for residents. To support this, the order establishes a ‘Ratepayer Protection Fund,’ which requires data centers that cannot immediately generate their own clean energy to pay a fee that is returned to ratepayers.

Additionally, the order mandates that data centers be located where sufficient water, wastewater, and infrastructure capacity exist, while minimizing air emissions. It also prohibits the use of non-disclosure agreements between state agencies and data center developers to promote transparency. While some industry groups expressed a need for responsible groundwork, labor representatives noted that data centers remain critical to the state’s knowledge-based economy.