ERCOT now has paused the batch interconnection process for data centers in response to Gov. Abbott’s announcement.
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Gov. Greg Abbott
Texas Gov. Greg Abbott has announced a moratorium on the approval of new data centers so state regulators can audit them for their energy, water, and land-use impacts.
In his Aug. 3 announcement, Abbott also said he wants the Texas Public Utility Commission and the Electric Reliability Council of Texas ensure that data centers meet all necessary requirements for legislatively authorized tax breaks. He said he wants regulators to reject ERCOT interconnection applications for those projects that fail the audit reviews. “Our top priority is to protect Texans’ safety and quality of life,” wrote Abbott.
More than 1,800 projects are currently awaiting approval in ERCOT’s “interconnection queue,” according to reports. Representing more than 474 gigawatts of electricity, the power consumption of these projects, if constructed, could exceed ERCOT’s current peak demand by more than four times. With approximately 90 percent of the new interconnection requests coming from data centers, ERCOT and the PUC recently began reviewing those requests in batches for the sake of efficiency. However, ERCOT now has paused the batch review process in response to Gov. Abbott’s announcement.
The Data Center Coalition, a trade group, urged regulators to quickly conduct the audits. “Done correctly, this review can showcase the good actors in the data center industry rather than delaying them unnecessarily,” organization spokesman Dan Diorio wrote in a statement Monday.
Abbott cited as a reason for his new directive the failure of some data center developers to respond to PUC water and power usage surveys. According to the Texas Tribune, an online publication, the PUC developed the surveys in collaboration with the Texas Water Development Board. Through the surveys, the PUC hoped to gather information about the water consumption, cooling systems, water sources, and electricity demand of individual data centers. The PUC also hoped to determine whether the facilities have their own on-site power source. However, Rep. Brad Buckley, a member of the House Natural Resources Committee, has called survey participation “pretty pathetic”. Of the 377 companies PUC notified when the survey was launched, 28 submitted responses, according to reports.
Grassroots Resistance
Amid grassroots resistance to data centers generally, cities and county governments also have stepped in. In June, San Marcos became the first Texas city to issue a local data center moratorium. Separately, the Hood County Commissioner’s Court tried and abandoned efforts in February to pass a countywide data center moratorium. Similarly, Hill County approved a moratorium on data center development in May but then rescinded the measure one month later after getting sued for $100 million.
Data center development also has become an issue in the governor’s race. Shortly after Abbott announced his moratorium, his Democratic party opponent, State Rep. Gina Hinojosa, said he should have gone further. “So nice to see another strongly worded letter from Abbott after he proudly made Texas the wild west of data centers,” Hinojosa wrote in a statement.
At least 335 data centers operated in Texas, according to the Texas Tribune. However, about 62 percent of Texas rural voters oppose data center construction in their communities, according to recent polling.