Texas Governor Abbott Directs Regulators, Proposes Laws on Data Center Energy, Water, and Tax Impacts
Texas Governor Greg Abbott has issued directives to electric regulators, requiring new data centers to cover their own power infrastructure costs and reduce residential electric bills. The Governor also proposed new state laws to repeal data center sales tax exemptions, mandate water-efficient technologies, and require reporting on electricity and water usage. These actions aim to mitigate the impact of data center growth on the state's resources and consumer costs.
Texas Governor Greg Abbott has taken action to address the impact of rapid data center growth on the state's resources and economy. The Governor has directed electric regulators, including the Electric Reliability Council of Texas (ERCOT) and the Public Utility Commission (PUC), to implement measures ensuring that new data centers pay for their own power and infrastructure, and that their operations lead to a reduction in residential electricity costs.
In addition to these directives, Governor Abbott announced plans to propose new legislation during the upcoming session. These proposed laws would repeal a sales tax exemption currently benefiting data centers, which could save the state billions in tax revenue. Furthermore, the legislation would require data centers to adopt water-efficient technologies and mandate comprehensive reporting of their electricity and water consumption. Abbott emphasized that data centers must operate in a manner that lowers costs for residents, conserves water, and considers community needs, signaling a more stringent regulatory environment for the industry in Texas.