Texas Gov. Greg Abbott issued a moratorium on data center development this month that will remain in place until the Public Utility Commission of Texas (PUCT) and the Electric Reliability Council of Texas (ERCOT) audit and review their operations.
Since the announcement, 24 large technology companies have agreed to comply with the state’s standards and guidelines for data center development. These companies include:
- Amazon.
- Lancium.
- Cipher Digital.
- Galaxy.
- Compass Datacenters.
- Montera Infrastructure.
- Microsoft.
- Hut 8.
- Equinix.
- Core Scientific.
- Vantage Data Centers.
- SB Energy.
- Google.
- Rowan.
- CleanSpark.
- EdgeConneX.
- Stream Data Centers.
- Oracle.
- Open AI.
- Meta.
- Skybox.
- Digital Realty.
- Mara.
- QTS Data Centers.
Despite Texas’ reputation as a proponent for big businesses, the state’s decision to halt data center development reflects clashing sentiments and friction with data center construction and operation practices nationwide. These concerns especially consider growing power demand as data centers request grid connectivity, providing significant strain on energy grid stability and reliability.
At the moment, ERCOT is considering around 474 gigawatts of requests for grid connections – five times more than Texas’ peak electricity demand. Around 90% of those requests come from data centers alone.
“I established clear guardrails to ensure data centers protect our electric grid, conserve our water, respect our neighborhoods, and pay their own way,” Abbott said. “They must not pass costs on to Texas families or interfere with their quality of life.”
The comprehensive review and audit will help provide assurances that these sites will comply with PUCT and ERCOT standards. Those who refuse or fail inspection will not be able to connect to the Texas energy grid, crippling their ability to operate effectively. To comply with these standards, data centers must:
- Pay for their electric infrastructure instead of shifting costs onto Texas families and small businesses.
- Reuse their own water.
- Reduce the cost of electricity for Texans.
- Not disrupt residential neighborhoods to preserve Texans’ quality of life.
- Pay their own way and eliminate reliance on taxpayer-funded incentives.
Both the PUCT and ERCOT will evaluate each data center project. Each project must be able to prove its ability to fulfill each standard requisitioned by the agencies. Approval will only be given once companies demonstrate their capacity to fund projects, provide power, manage water, ensure transparency and minimize impacts on neighboring communities.
Photo by Akela999 from Pexels
This story is part of the weekly Texas Government Insider digital news publication. See more of the latest Texas government news here. For more national government news, check out Government Market News daily for new stories, insights and profiles from public sector professionals.
