Texas Governor Greg Abbott has ordered a halt on new data center approvals and directed state regulators to audit every facility waiting to plug into the grid. The move, announced this week, forces data centers to disclose how much power and water they'll use, what public subsidies they've taken, and how they plan to handle noise and traffic. Any project that doesn't comply, Abbott said, will be denied connection.
Why the Pause Was Ordered
ERCOT, the state's grid operator, is juggling more than 474 gigawatts of connection requests — over five times the state's record peak demand. Data centers account for roughly 90% of that queue. Abbott's directive gives the Public Utility Commission of Texas (PUCT) and ERCOT the job of auditing all data centers already in the interconnection process. Projects that fail to meet state requirements won't get the green light.
'Any project that fails to comply with the requirements set forth by the PUCT and ERCOT, and by state law, must be denied connection to the Texas grid,' Abbott said. 'Simply put, Texans must come first.'
The Five Required Disclosures
Companies seeking grid access must now reveal five categories of information: public funding, power use, water consumption, community impact, and ownership. That means spelling out taxpayer-funded incentives they've received, projected electricity demand, plans for on-site generation, water sources and reuse methods, plus community measures like noise and traffic controls.
The disclosures are designed to give regulators a clear picture of what each facility will actually draw from the grid — and what it gives back to the surrounding area. For years, data center developers could request massive amounts of power without detailing how they'd use it or what strain it would put on local resources.
A Growing Backlash Beyond Texas
Texas isn't the only state tightening the screws. New York enacted the first statewide moratorium on new hyperscale data centers in July. Roughly a dozen other states have proposed similar bans, according to CNN. Public sentiment is turning, too. A Gallup poll found 71% of Americans oppose having a data center built in their local area. A Reuters/Ipsos survey put that number at 57%.
The tension is straightforward: data centers bring jobs and tax revenue, but they chew up land, water, and electricity — often with little local oversight. Texas's record queue shows just how much demand is piling up, and the pause gives regulators time to sort through it before more projects lock in grid capacity.
What Happens Next
The PUCT and ERCOT audits are now underway. Data centers already in the pipeline will have to submit the new disclosures or face denial. There's no set deadline yet for when the audits will wrap up or when approvals might resume. Until then, every pending project sits in limbo — and every new application stays frozen.
