Data Centers in Texas: 474 GW of Grid Requests, a $1.305 Billion Tax Break and a State Audit
Texas is tracking about 474 GW of large-load interconnection requests, roughly 90% of which are associated with data centers. Gov. Greg Abbott directed the Public Utility Commission and ERCOT to audit advancing data center projects, while state analyses highlight billions in tax exemptions and potentially significant water use.
Texas data center development is driving a large pipeline of electricity requests, with ERCOT reporting approximately 474 GW of large loads seeking interconnection as of June 2026. ERCOT has conditionally classified 362 eligible Batch Zero projects representing 194.3 GW, but the classifications are not final and the audit and verification process has paused or potentially altered the study timeline.
Gov. Greg Abbott’s Aug. 3 directive requires the Public Utility Commission of Texas and ERCOT to audit data centers before projects advance, including their projected electricity and water needs, supply sources and cooling technologies. Analysis from the Rice University Baker Institute estimates the state’s data center sales-tax exemption could cost $1.305 billion in 2026 and $1.753 billion by 2030, while the Houston Advanced Research Center estimates existing facilities use about 25 billion gallons of water annually, potentially rising to as much as 161 billion gallons by 2030.