Lawmakers try to balance booming data center industry with concern from Texans

Christine Benson, a resident of Hutto, Texas, is voicing strong opposition to a proposed mid-scale data center development by Zydeco Development. The project requires a rezone of land across from Benson's home, currently designated for mixed-use, to allow for heavy industry construction. Benson and other residents are concerned about potential noise from the facility, the risks of leaks or fires in a populated area near schools, and increased local temperatures impacting home cooling costs. She stated, "I'm also afraid of my home getting more expensive to keep cool if the temperatures rise around the data center." Zydeco Development, represented by Wes Gilmer, presented plans to mitigate residential impact during a Hutto Planning and Zoning Commission meeting. These plans include a five-acre greenspace buffer with two rows of trees and two eight-foot masonry walls separating the service yard from adjacent residential areas. The company estimates the project could generate $312 million in tax revenue for the city. Simultaneously, state lawmakers are actively developing new regulations to address the rapid growth of data centers in Texas, which ranks second nationally in data center construction. The state’s energy regulators told a House committee they are drafting rules to ensure data centers bear the costs of their high energy demands, rather than residents. ERCOT CEO Pablo Vegas stated that proposed regulations would require data centers to use backup generation during grid emergencies to prevent additional strain. ERCOT is also surveying data centers on their water usage amidst state water shortages. Residents like Benson are urged to attend upcoming meetings to express dissent, as the Hutto City Council is scheduled to vote on the rezoning plan in May. While the Texas Legislature is not expected to halt data center construction statewide, it has signaled a move toward tighter regulations.