CloudTalen Energy Corporation and Cumulus Data Applaud the Passage of Pennsylvania’s Digital Infrastructure Legislation, House Bill 952, Which Provides Sales and Use Tax Exemption for Data Center Investment in the Commonwealth

Talen Energy Corporation (“Talen” or “the Company”) and Cumulus Data (“Cumulus Data”) today applaud Governor Tom Wolf, House and Senate leadership, Representative Donna Oberlander and members of the Pennsylvania Legislature for passage of an exemption of data center IT infrastructure investments from state sales and use tax. House Bill 952 was recently signed into law with bi-partisan support as part of the recent Pennsylvania budget package. Talen and Cumulus Data believe this incentive is key to attracting data center clients and accelerating digital infrastructure investment in the Commonwealth.

“We believe this legislation will allow Cumulus Data and other digital infrastructure companies in Pennsylvania to more effectively compete with the country’s largest data center markets in Ashburn, Virginia and other rapidly growing cloud infrastructure hubs across the U.S.,” said Alex Hernandez, CEO of Cumulus Data and President of Talen. “The combination of this legislation and the low-cost, reliable, carbon-free energy of our Susquehanna generation facility enables Cumulus Data to offer the lowest total cost of ownership and carbon-free ESG benefits to cloud, AI, and data center clients globally.”

Talen announced recently that it has broken ground on the Cumulus Data center campus on land adjacent to its Susquehanna nuclear generating facility, located outside Berwick, Pa. The Cumulus Data digital campus will provide up to one Gigawatt of carbon-free energy generated by Susquehanna’s dual units to power the campus, including 475 Megawatts for hyperscale data center clients and 300 Megawatts for other digital infrastructure applications. The Cumulus Data digital infrastructure investment will create family-sustaining jobs, technology training, and other economic benefits including tax revenue and increased consumption of local goods and services to both the Commonwealth and surrounding community. The first data center is expected to be commercially for lease in the second half of 2022.

Governor Tom Wolf, who signed the bi-partisan legislation, commented: “Pennsylvania has always been a place of innovation and welcomes digital infrastructure investment in the Commonwealth. We believe Pennsylvania has many competitive advantages to become a leading data center hub, including significant existing fiber infrastructure, abundant energy resources, carbon-free electricity generation, an exceptional workforce, and geographic proximity to the 60-80 million customers in the region. Pennsylvania’s data center legislation drives our Commonwealth to a technology manufacturing future, while creating high paying jobs across our communities this year and for generations to come.”

Ralph Alexander, Chairman and CEO of Talen, said, “We are extremely grateful to the Pennsylvania Legislature and the Governor for their key support of this legislation, as well as Susquehanna’s senator, John Gordner, for his efforts to advance the bill in the legislature, and Representative Donna Oberlander for sponsoring House Bill 952. Their efforts will help Pennsylvania reap the benefits that other states have enjoyed from this rapidly growing industry, which include jobs, tax revenue and infrastructure investments. Our Cumulus Data investment is a tangible expression of Talen’s Force for Good strategy to invest in and support the communities in which we operate.”

Bill sponsor, Representative and Majority Whip representing the 63rd District, Donna Oberlander, commented on the projected benefits as well, “This measure has the potential to create thousands of new jobs in a rapidly growing industry while also serving as a catalyst for greater fiber and broadband deployment. Without this legislation, Pennsylvania was not on level footing with other states, as it worked to attract data center clients and digital infrastructure investments.  This resulted in the Commonwealth missing out on the many benefits data centers have brought to other areas such as Ashburn, Virginia with more favorable tax treatment. Because Pennsylvania does not yet have a significant number of data centers operating here in the Commonwealth, the tax exemptions offered will create additive benefits, without any significant loss in revenue. We look forward to seeing this attractive industry grow quickly and benefit the economy for generations to come.”

Talen’s Cumulus Data hyperscale data center campus is part of the Company’s larger transformation to a more sustainable future. This transformation, which was discussed during the Company’s investor day in May, is centered on converting legacy fossil power generation facilities to clean power sources and investing in renewable energy, battery storage and digital infrastructure within its current asset footprint.  Talen recently announced a joint venture with Pattern Energy to develop 1.4 Gigawatts of solar and wind generation across its footprint, including 400 Megawatts of solar generation in Pennsylvania. Talen’s first 100 Megawatt solar project, located in Montour County, Pa., is anticipated to break ground in 2022 and provide renewables additionality to digital infrastructure clients of the Cumulus Data center campus.  Talen’s approach, which includes converting, not closing, legacy generation facilities to cleaner energy sources and developing new infrastructure opportunities in the communities in which it operates, is what the Company calls its “Force for Good” ESG strategy.

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