Texas Pauses Data Center Grid Approvals as Power Requests Hit 474 GW

Governor Greg Abbott has temporarily halted the approval process for new data center grid connections in Texas while regulators examine proposed projects seeking 474 GW of power capacity. This pause comes as power demands have reached 474 GW, with data centers accounting for about 90% of the proposed load. The Texas Public Utility Commission and ERCOT will review projects for compliance with state laws and safety regulations, including on-site and off-site power generation, water demand, cooling operations, tax incentives, ownership, and community impacts.

The audit aims to identify responsible developers and prevent unnecessary delays. Data Center Coalition spokesperson Dan Diorio stated that the review can help distinguish good actors in the industry. However, the timeline for the reviews and the resumption of approvals remains unclear. With over 1,800 proposed projects in ERCOT's queue representing more than 474 GW of requested power, the scale of electricity demand associated with AI infrastructure, cloud services, and other computing workloads is significant.

The audit applies to data centers seeking ERCOT grid access and does not stop projects generating their own electricity or facilities in regions outside ERCOT. Developers should consider the audit timeline and approval standards as potential risks and account for longer approval periods, more detailed disclosures, and the possibility of grid connection denials in their project planning.