Governor Greg Abbott has paused new data-center approvals in Texas and ordered the PUCT and ERCOT to audit all interconnection applicants. Projects must disclose public funding, projected power and on-site generation, water sources and reuse, community impacts, and ownership. ERCOT is evaluating more than 474 GW of requests—about 90% from data centers—and noncompliant projects can be denied grid connection. Similar moratoria and restrictions are emerging in other states amid growing public opposition.
Texas Imposes Five Disclosure Rules for Data Centers and Pauses Approvals Amid Backlash
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Texas Governor Greg Abbott has ordered a halt to new data-center approvals and directed state regulators to require five mandatory disclosures before any facility can connect to the state's power grid. The move responds to rising public concern about the environmental and community impacts of rapid hyperscale data-center construction.
What Regulators Now Require
The Public Utility Commission of Texas (PUCT) and the Electric Reliability Council of Texas (ERCOT) will audit every data center currently progressing through ERCOT's interconnection queue. Projects that fail to meet the state's standards will be denied grid connection.
Five disclosure areas:
- Public Funding: Full disclosure of any taxpayer-funded incentives or subsidies.
- Power Demand and On-Site Generation: Detailed projected electricity needs and plans for on-site generation or mitigation.
- Water Use and Reuse: Sources of water, expected consumption, and reuse or conservation strategies.
- Community Impacts: Expected effects on local traffic, noise, and other quality-of-life concerns, with proposed mitigation measures.
- Ownership and Transparency: Clear identification of owners, operators, and any related corporate structures.
"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. Simply put, Texans must come first," Governor Greg Abbott said.
Scale And Broader Context
The scope of the issue is substantial: ERCOT is reviewing more than 474 gigawatts of interconnection requests—more than five times the state's record peak demand—and data centers account for roughly 90% of those requests. The governor's directive applies to all facilities in the queue.
Texas' actions mirror a national trend. New York implemented a statewide moratorium on hyperscale data centers in July, and roughly a dozen states have considered bans or restrictions. Public opposition is also rising: a Gallup poll found that 71% of Americans would oppose a data center in their local area, while a Reuters/Ipsos survey found 57% would resist one in their community.
This policy shift aims to balance economic development with grid reliability, environmental stewardship, and community welfare as demand for AI and cloud services grows nationwide.
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