Abbott announces actions protecting residents from Data Center costs

Governor Greg Abbott announced that the Public Utility Commission of Texas (PUCT) and the Electric Reliability Council of Texas (ERCOT) are implementing measures to protect Texas residents from the financial and resource burdens of data center growth. This follows Abbott's June 10 directive for these state entities to ensure data centers cover their own electric infrastructure costs, avoid increasing residential bills, and prioritize power for Texas families.

Key actions underway include requiring data centers to pay for dedicated transmission infrastructure and contribute to lowering residential electric bills. New rules will prevent large data centers from diverting existing power from the ERCOT grid, ensuring priority for communities. Sweeping changes are being made to how data centers finance their infrastructure to prevent cost shifting to Texans and avoid straining state resources. ERCOT has also implemented a new interconnection screening process to prevent grid overburdening, strengthened its development evaluation, and improved long-term planning for reliability. Stronger grid connection standards and a mandate for new data centers to quickly reduce power upon ERCOT instruction are also being developed.

Additionally, the PUCT and ERCOT have recommended several legislative changes for the upcoming session. These include expanding the Lone Star Infrastructure Protection Act to cover large data centers, clarifying the PUCT's and ERCOT's authority to set reliability requirements for data centers, and mandating data center registration with both commissions for accurate data on water and electricity operations. Governor Abbott affirmed his commitment to working with the Legislature to codify these protections.