Texas freezes data center projects pending sweeping audits

Gov. Greg Abbott on Monday said that data center projects in the state were blocked from connecting to the Texas power grid until regulatory agencies comprehensively audited each one. He ordered the agencies to gather information on data centers’ ownership, funding, need for power and water, and the extent of the impact each would have on neighboring communities. Some data centers had already broken Texas law by failing to disclose power and water usage, he said.

The Electric Reliability Council of Texas, which oversees the state’s power grid, was currently fielding more than 474 gigawatts’ worth of requests to connect to the grid, Abbott said. That amount of power was more than five times Texas’ record peak demand for electricity. About 90% of those new requests came from data centers, he said. The audit would determine whether new projects endangered the reliability and stability of the Texas grid, he said.

The news came weeks after New York imposed a one-year moratorium on the new construction of data centers. President Donald Trump said at the time that Texas, Alabama, and Florida were among the states welcoming data centers, recognizing their potential to bring in more money and jobs.

The audit appears to apply to the hyperscale data center planned to cover a 1,384-acre swath of Fort Bliss, Texas. The U.S. Army reached a conditional agreement in March for the center’s development in partnership with Carlyle, a global investment firm. The relationship would fall under the Army’s Enhanced Use Lease program, which allows the Army to collect rent from developers of underused property.

Dig deeper: Read Christina Grube’s report on New York’s data center moratorium.