Push back on data centers by Texas voters gains attention of state GOP leaders, Democratic challengers

Growing public dissatisfaction with data centers, particularly AI data centers, across Texas has captured the attention of statewide political leaders from both Republican and Democratic parties. In response, Governor Greg Abbott has issued multiple directives since June, including a pause on new data center development.

Goodwin, the Democratic candidate for Lt. Governor, noted that this issue has garnered more public engagement than any other recently. She has participated in rallies in Fort Worth and other locations across the state to protest data center expansion. Earlier this month, Governor Abbott instructed the Public Utility Commission of Texas and ERCOT to conduct a thorough audit of all data centers undergoing the grid operator's interconnection process.

As part of this audit, data center developers must disclose ownership, funding sources, power acquisition methods, and anticipated power and water consumption. They are also required to detail strategies for mitigating community impacts such as noise and light pollution. Only data centers that comply with state agency requirements and state law will be granted grid access. Previously, Governor Abbott outlined guidelines requiring data centers to provide their own power and water, reuse water, generate electricity that contributes to the grid without raising prices, avoid building in residential neighborhoods, and forgo state economic incentives.

Both Republican and Democratic leaders have expressed a desire to eliminate state sales tax incentives for data centers, which were initially approved in 2013 to attract the industry. The Data Center Coalition and its 44 member companies have sent a letter to Governor Abbott expressing support for this new approach. Polling data from Cygnal and Texas Public Opinion Research indicates strong public backing for the governor's policies, with a high percentage of Texans supporting requirements for AI data centers to disclose water usage, avoid overused aquifers, fund conservation projects, and finance their own grid upgrades without passing costs to ratepayers. While the state legislature is not currently in session, lawmakers are actively discussing the data center controversy, with the Texas House State Affairs Committee scheduled to receive an update on the issue at the Texas Capitol.