Governor Orders Audit, Pauses New Data Center Grid Connections

Texas Governor Greg Abbott has issued a directive ordering a comprehensive audit of all data center projects that are seeking to connect to the state's electric grid. The order, announced Monday, effectively places a hold on new data center developments until the audit is finalized and projects meet state requirements.

Governor Abbott instructed the Public Utility Commission of Texas (PUC) and the Electric Reliability Council of Texas (ERCOT) to verify every data center in ERCOT’s interconnection process. He emphasized that the reliability of the state’s electric grid and the quality of life for Texans are his top priorities. State officials report that ERCOT is currently reviewing requests totaling over 474 gigawatts of new electric demand, with approximately 90% attributed to data center developments.

As part of the audit, developers will be required to disclose details on tax incentives, anticipated electricity and water consumption, on-site power generation plans, and measures to mitigate community impacts. Information regarding project ownership and controlling interests will also be mandatory. The announcement comes amidst public criticism over several large-scale data center projects across Texas, including two proposed in Guadalupe County, which have raised concerns among residents about power and water demands, as well as tax incentives.

The governor's order means no data center project currently in ERCOT’s interconnection queue can proceed until the audit is concluded. Its impact on specific proposed projects, such as those in Guadalupe County, remains unclear.