Greg Abbott turned from data center ‘epicenter’ booster to skeptic—and Trump is calling it an economic ‘mistake’

Texas Governor Greg Abbott has shifted from being a strong supporter of artificial-intelligence data centers to criticizing the industry, stating that companies have "dug their own grave" for the problems they face. This change in stance has been driven by concerns over electricity demand, water consumption, and neighborhood disruption associated with the rapid development of data centers without proper community engagement.

In response to growing opposition, Abbott has directed state regulators to halt new grid-connection approvals for data centers until a thorough verification and audit of pending projects is completed. This move is part of a broader regulatory crackdown that has halted over 1,800 projects, totaling roughly 474 gigawatts of potential capacity, which is more than five times the peak electricity demand of the Electric Reliability Council of Texas (ERCOT).

The governor's shift in position has caused a rift with President Donald Trump, who has called the crackdown an "economic mistake." Texas currently accounts for around 100 gigawatts of planned data center capacity, according to independent analysis, more than the next two largest states combined. However, only about 17 gigawatts of data centers are currently operational in Texas, indicating that the majority of the planned capacity remains unfulfilled.

Abbott's new audit aims to address this gap and ensure that future projects comply with state requirements, including proper community engagement and reporting of power and water usage.