Texas to slow down data centre construction amid AI boom

Texas Governor Greg Abbott has imposed strict regulations on new data centre construction in the state, signaling a shift in the traditionally business-friendly approach to the burgeoning AI industry. Under the directive, developers must disclose financial assistance needs, estimated energy and water usage, measures to reduce noise and light pollution, and ownership details.

Any project failing to adhere to guidelines set by the Public Utility Commission of Texas, Electric Reliability Council of Texas, and state law will be denied access to the grid, prioritizing Texan safety and quality of life. Electric Reliability Council of Texas warned that by 2032, demand on the state's energy grid is projected to double, with increased strain due to population growth, extreme weather events, cryptocurrency mining, and data centres.

Abbott's order reflects the growing US opposition to data centres, driven by environmental concerns, noise issues, and potential electricity cost hikes. Big Tech and energy companies have rushed to build more data centres, but this surge has strained the US energy grid and caused electricity prices to soar. Texas has the second-highest number of data centres, with 296, following Virginia's 398.

Similar legislation aimed at slowing down data centre construction has been introduced in Delaware, Georgia, Michigan, Pennsylvania, South Carolina, and Vermont. A Gallup poll found that 70% of Americans oppose data centres near their homes, while 60% of registered US voters believe data centres would increase their electricity costs.

Energy Secretary Chris Wright defended data centres, stating that misconceptions can be dispelled through honest conversations.