Gov. Greg Abbott calls for data center penalties if not complying with state water laws
Governor Greg Abbott has issued multiple directives concerning data centers in Texas, calling for penalties for non-compliance with state water laws and temporarily halting new connections to the power grid. His stance has shifted due to public frustration and concerns over resource usage, leading to new standards for data center operations.
Governor Greg Abbott has significantly shifted his stance on data center development in Texas, moving from initially promoting the state as an AI development hub to implementing stricter regulations. This change follows growing public frustration and community opposition, particularly from rural areas, regarding the impact of data centers on local resources.
Abbott has issued several directives, including a call to repeal sales tax exemptions and other incentives for data centers. In August, he announced a temporary halt on new data center connections to the Texas power grid until state regulators complete an audit and companies comply with new standards. Approximately 20 companies have since agreed to these terms.
Most recently, Governor Abbott instructed the Texas Water Development Board to penalize data centers that fail to report water usage or do not comply with state water laws, emphasizing that data centers must not deplete water resources from communities. He also stipulated that facilities must not strain the power grid, should lower electricity costs for consumers, and avoid disturbing neighborhoods, asserting these standards are now universally applied. Abbott criticized data centers for previously operating without sufficient collaboration with state and local governments, leading to public backlash.