Texas Gov. Greg Abbott has ordered an audit of approvals for data centers due to concerns over power generation in the state, effectively pausing new construction of facilities that have become in demand due to artificial intelligence (AI).
In a statement on Monday, Abbott said that data centers, which are physical rooms used to store large amounts of information and are heavily used in AI models, must comply with Public Utility Commission (PUCT) and Electric Reliability Council of Texas (ERCOT) mandates.
“Our top priority is to protect Texans’ safety and quality of life,” said Abbott, confirming the move. “Any project that fails to comply with the requirements set forth by the PUCT and ERCOT, and by state law, must be denied connection to the Texas grid. Simply put, Texans must come first.”
ERCOT is currently reviewing roughly 474 gigawatts of proposed new electricity demand, representing more than five times the state’s record peak load, the governor said. He added that about 90 percent of the power requests are from data centers.
Under Abbott’s directive, developers will be required to provide more information on power demand, water use, tax incentives, ownership structures, and efforts to mitigate local impacts.
The audit encompasses several points, including whether the data centers are bringing in their own water or reusing water for cooling, rather than using water used by municipalities across the state, according to a news release from the governor’s office.
It will also determine the “extent to which data centers are providing their own power or depending on the ERCOT grid for that power,” the news release said.
“Details should include projected annual and peak electricity consumption; and any effort and progress to construct or procure on-site electric generation including generation type, or other measures to reduce demand on the ERCOT grid,” the release added.
Texas Lt. Gov. Dan Patrick said in a post on X last week that ERCOT’s plans to construct more power lines have regulatory issues that need to be addressed.
“Everyone agrees Texas needs the transmission necessary to meet the growing needs of the state. However, support for ERCOT’s 765-kV transmission plan should not come at the expense of private property rights,” he wrote, referring to a type of extra-high-voltage power line used to move large amounts of electricity over long distances.
Data centers have faced mounting opposition from Americans. Only around one-third of Americans approved the pace of data-center construction in a June poll carried out by Reuters and Ipsos.
The issue could become a sticking point ahead of the November midterm elections. Abbott, a Republican, is seeking reelection for a fourth term.
A Democratic gubernatorial challenger to Abbott, Rep. Gina Hinajosa (D-Texas), said in a statement that the governor is not doing enough to protect the state from data center construction.
“So nice to see another strongly worded letter from Abbott after he proudly made Texas the wild west of data centers. Abbott’s call for a ‘pause’ could be for one day—and no one buys it,” she said this week. “He’s taken millions from data center CEOs while giving Texans lip service to non-existent restrictions.”
