Growing bipartisan pushback against data centers in Texas

A growing bipartisan pushback against data center developments is occurring in Texas. Governor Greg Abbott recently announced that a developer withdrew plans for a facility near Cedar Creek Lake after the proposed project failed to meet community expectations and the governor's new directive. This directive mandates that ERCOT and the Public Utility Commission implement new rules requiring data center developers to cover their own power costs and reduce water usage to prevent increased utility expenses for other customers.

State Representative Gina Hinojosa, a Democrat running for governor, urged Governor Abbott to issue an executive order to halt data center development statewide until a special legislative session can be called to address the issue. She argued that data centers are operating without sufficient oversight, leaving local communities powerless. In response, a spokesperson for Governor Abbott's campaign referred to his June directive and the PUC's ongoing efforts to protect Texans from the impact of large energy users.

Some data center developers, represented by organizations like Texas Connects, are countering this narrative. They assert that their facilities minimize strain on resources and provide economic benefits, such as job creation. Texas lawmakers have conducted multiple hearings to explore regulatory options for data centers, expressing frustration over the lack of transparency from developers regarding their resource consumption, particularly water usage. A Texas Senate committee is set to meet again, but new laws cannot be passed until the next regular legislative session begins in January.