Abbott orders a halt on all data center permits

Texas Governor Greg Abbott has issued his fourth directive concerning data center expansion in the state, ordering the Texas Commission on Environmental Quality (TCEQ) to halt all permits for data centers until comprehensive state agency audits are finalized. This decision comes amid ongoing public opposition to data center developments, primarily due to concerns about water consumption and the burden on electrical infrastructure.

The Governor's directive mandates that data center projects must cover all electrical infrastructure costs, contribute to lower residential electricity bills, and complete all required state agency audits. He previously instructed the Public Utility Commission of Texas (PUCT) and the Electric Reliability Council of Texas (ERCOT) to audit all data centers in the interconnection process. He also directed the Texas Water Development Board (TWDB) to enforce penalties for data centers failing to comply with water usage reporting requirements under the Texas Water Code.

Governor Abbott emphasized that "Texans must come first," asserting that data centers must be self-sufficient, protect the state's grid and water resources, and successfully complete ERCOT and TWDB audits before any permits are issued. State Representative Gina Hinojosa, D-Austin, had previously called for an emergency executive order for a moratorium on new data center development, a request Abbott's directive appears to partially address. Additionally, Abbott announced plans to work with the legislature next year to eliminate financial incentives for data centers that were established about a decade ago.