Texas Governor Proposes Data Center Regulations and Tax Repeal
Texas Governor Greg Abbott has issued directives to electric regulators and ERCOT, requiring new data centers to cover infrastructure costs and ensure no increase in residential electric bills. He also proposed new laws for the upcoming legislative session that would repeal data center sales tax exemptions, mandate water-efficient technologies, and require usage reporting. These measures aim to manage the impact of rapid data center growth on the state's resources.
Texas Governor Greg Abbott has taken action to address the escalating growth of data centers in the state, which is raising concerns about energy consumption and water usage. The Governor has directed electric regulators and the Electric Reliability Council of Texas (ERCOT) to mandate that new data centers bear the costs of the power and infrastructure required for their operations. This move aims to prevent data center growth from driving up consumer electric bills.
Furthermore, Governor Abbott has ordered the Public Utility Commission to implement policies ensuring that new data centers actively contribute to reducing residential electric bills. He emphasized that data centers must operate sustainably, "reduce costs for residential electricity customers, do not drain water needed for our communities and take into consideration the needs of our neighborhoods."
Looking ahead to the next legislative session, the Governor has proposed several new laws. These include repealing a sales tax exemption for data centers, which could save the state billions in revenue. Additionally, the proposed legislation would require data centers to adopt water-efficient technologies and regularly report their electricity and water usage. The article notes that Texas is a national leader in new solar capacity, with data center growth being a major factor in this rapid expansion, as solar projects can come online quickly.