Texas has paused the approval of new data center connections to the state grid until an audit is completed. This audit will not only focus on electricity usage but will also examine tax incentives and ownership structures of these projects.
Governor Greg Abbott directed the Public Utility Commission of Texas and the Electric Reliability Council of Texas to conduct this comprehensive review. The audit will require operators to disclose information on electricity demand, water usage, noise mitigation, light controls, and the incentives they claim.
Notably, the ownership details are crucial, as data centers often involve complex holding company structures that obscure who is responsible for the projects.
According to ERCOT, there are over 1,800 projects in the interconnection queue, totaling more than 474 gigawatts of demand, which is significantly higher than the grid's peak record. Abbott noted that data centers account for approximately 90 percent of new requests. In January, the queue stood at 233 gigawatts.
The Colony, located about 12 miles northwest of Plano, is part of a region that has emerged as the second largest data center market in the country. The audit aims to provide clarity on the economic trade-offs associated with this growth, which has been a point of discussion for local economic development.
Projects that generate their own power on-site are exempt from this pause, and no completion date for the audits has been set.
