Texas House panel begins to scrutinize data centers

The Texas House Committee on State Affairs has initiated an investigation into the rapid expansion of data centers across the state, prompted by concerns that this growth is straining the power grid and could escalate energy and water costs. Texas has become a significant hub for data centers, leading to calls for new approval processes from officials. ERCOT CEO Pablo Vegas acknowledged the significant challenges in connecting large loads, such as data centers, to the grid. In response, ERCOT plans to stop approving individual data center projects and will instead launch a "batch" approval program this summer, processing a set of projects annually. This new approach aims to streamline growth management and mitigate grid strain, though some data center companies, including a leader from the Stargate project near Abilene, view it as a de facto moratorium on development. Dan Diorio of the Data Center Coalition emphasized the critical role data centers play in supporting essential services like hospitals and government agencies. However, state officials, including Public Utility Commission respondent Thomas Gleeson, are still working to address concerns raised by lawmakers like Representative Senfronia Thompson regarding the impact on water availability for constituents. Lawmakers anticipate receiving a comprehensive plan this summer, with the next opportunity to amend state laws during their regular session in January.