Texas has halted the approval of new data centers as state agencies assess their impact on the power grid. Governor Greg Abbott announced this decision amid concerns regarding the facilities' electricity and water usage, as well as their effects on local communities. This pause will remain until the audits by the Electric Reliability Council of Texas (ERCOT) and the Public Utilities Commission are completed.
The governor emphasized the need to ensure the power grid remains secure and reliable, stating that data centers must undergo thorough evaluations before receiving state approval. Abbott's announcement coincides with the construction of a $14 billion Meta campus in El Paso, which has raised local concerns about resource consumption and community impacts.
Democratic gubernatorial nominee Gina Hinojosa has criticized the pause as insufficient, calling for an emergency legislative session to address the lack of regulations governing data centers. She expressed that existing agreements for projects should be reviewed, particularly regarding their implications for water resources in El Paso.
While the focus has been on the El Paso project, the statewide nature of the approval freeze means it affects potential data center developments across Texas. ERCOT, which manages the power grid for most of the state, will play a crucial role in determining how these facilities impact electricity demand and supply, influencing ratepayers far beyond local communities.