Abbott pauses Texas data center projects pending state audit
Texas Governor Greg Abbott has ordered the Public Utility Commission of Texas and ERCOT to halt proposed data center projects until a comprehensive audit is completed. This audit will verify critical details such as electricity and water demands, ownership, and community impacts. The move is in response to concerns that rapid data center growth could threaten grid reliability and impact ratepayers.
Texas Governor Greg Abbott has issued a directive ordering the Public Utility Commission of Texas (PUCT) and the Electric Reliability Council of Texas (ERCOT) to temporarily halt proposed data center projects. The directive mandates a comprehensive verification and audit of all data centers currently advancing through ERCOT’s interconnection process before any further projects can be approved. Projects failing to meet agency requirements or state law will be denied connection to the Texas grid.
The governor emphasized that the state's top priority is protecting Texans' safety and quality of life, stating that any non-compliant project must be denied. The move comes as ERCOT reviews an astounding 474 gigawatts of connection requests, with approximately 90% attributed to data centers, raising significant concerns about grid reliability due to rapid load growth. Abbott's order expands on a previous June 10 directive aimed at shielding residential ratepayers from increased costs.
The latest directive requires data center projects to provide detailed information including whether they receive state or local financial assistance, their electricity sources (on-site or ERCOT grid), projected annual and peak electricity consumption, and comprehensive water usage plans, including cooling technology and water efficiency. Furthermore, projects must disclose measures to mitigate community impacts such as noise, light, setbacks, traffic, and emergency response coordination, along with ownership details.
Abbott also reiterated his commitment to working with lawmakers in the next session to codify protections requiring data centers to contribute to the state's electric capacity, utilize water-efficient systems, provide accurate usage data, phase out outdated tax incentives, and adopt community-protective practices.