Henderson County Data Center Project Scrapped Before It Ever Broke Ground
A proposed data center project by Diode in Henderson County, Texas, has been scrapped because it failed to meet the state's expectations for protecting local communities, natural resources, and the power grid. Governor Greg Abbott also announced plans to seek legislation requiring large data centers to report electricity and water usage and eliminate certain sales tax exemptions and incentives.
A planned data center project near Cedar Creek Lake in Henderson County, East Texas, has been withdrawn by developer Diode after it failed to meet state standards. Governor Greg Abbott announced the project was scrapped because it did not protect local communities, natural resources, and the Texas power grid, emphasizing that companies must prioritize residents' benefits.
Abbott praised Diode's decision, stating that Texas requires companies to put communities first and respect the quality of life of residents. The state's expectations were outlined in a June directive issued to the Public Utility Commission of Texas (PUC) and the Electric Reliability Council of Texas (ERCOT), which guides data center development.
Looking ahead, Governor Abbott plans to pursue new legislation that would mandate large data centers to report their annual electricity and water usage to the PUC. Additionally, he intends to seek the elimination of specific sales tax exemptions and other incentives currently offered to data center projects within the state.
Despite these new requirements, Governor Abbott affirmed that Texas will continue to encourage data center development, but only for projects that can demonstrate they protect existing residents, infrastructure, and rural communities, rather than imposing further burdens on them.