Texas approves grid standards to keep data centers online
Texas regulators have approved new grid standards requiring data centers and crypto-mining facilities to maintain operations during temporary power disturbances. This measure aims to prevent cascading outages but is projected to cost tech companies billions of dollars. The new rules are effective for facilities approved after November 15, 2025, and may face legal challenges from industry groups questioning the PUC's regulatory authority.
Texas regulators, specifically the Public Utility Commission (PUC), unanimously voted 5-0 to adopt new grid standards aimed at ensuring data centers and crypto-mining facilities, categorized as "large computational loads," remain operational during temporary grid disturbances. The Electric Reliability Council of Texas (ERCOT) emphasizes that these "ride-through" capabilities are crucial to prevent widespread power outages that could result from these high-consumption facilities tripping offline simultaneously.
Industry representatives, including Jessi Goostree from the Texas Blockchain Council, argue that the new rules, which apply to facilities energized on or after November 15, 2025, could impose significant costs—ranging from $500,000 to $1 million per megawatt—on their members, potentially totaling hundreds of millions of dollars for some. They suggest alternative solutions, such as Texas' planned $33 billion transmission build-out, could address grid stability. Additionally, groups like the Texas Industrial Energy Consumers, represented by Katie Coleman, express concerns that the PUC may be overstepping its regulatory authority by imposing requirements on retail power users, hinting at potential litigation should these regulations expand to affect their members. PUC senior council R. Floyd Walker, however, clarifies that the regulations target data center infrastructure, not the entities themselves, a distinction he argues is crucial for grid reliability.