Texas Governor Greg Abbott has instructed state utility regulators to examine all new data center proposals as rising electricity demand raises concerns about the stability of the state’s power grid.
Under the directive, the Public Utility Commission of Texas (PUCT) and the Electric Reliability Council of Texas (ERCOT) will require developers of proposed data centers to submit detailed information, including ownership, financing, expected electricity and water use, and measures to reduce potential impacts on surrounding communities.
The directive comes as ERCOT reviews requests totaling more than 474 gigawatts of new grid capacity. The governor’s office said data centers account for more than 90% of those applications, warning that the unprecedented increase in electricity demand could threaten the reliability and stability of Texas’ power grid.
Texas is already one of the nation’s largest data center markets. Industry data ranks the state second with 521 operational facilities, behind only Virginia. The volume of new grid connection requests, comparable to the output of hundreds of large power plants, has raised questions about whether the state’s infrastructure can expand fast enough while maintaining reliable service for homes and businesses.
Texas isn’t the only place rethinking data center growth. Across the U.S., federal, state, and local officials are considering or have already adopted rules that make it harder to build new facilities. Much of the concern comes down to how much electricity and water they consume, with many residents worried they’ll raise utility costs and put extra pressure on local infrastructure.
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