en.Wedoany.com Reported - Texas Governor Greg Abbott announced Monday that all new data center projects must undergo audits by the Public Utility Commission of Texas (PUCT) and the state's grid operator, the Electric Reliability Council of Texas (ERCOT). This mandatory measure aims to address the pressure on the Texas power grid caused by a surge in data center interconnection requests.
ERCOT's interconnection queue has expanded dramatically since the start of this year. In January, ERCOT had 233 gigawatts of projects waiting to connect to the grid, a figure that more than doubled in less than six months. Abbott's office stated that ERCOT is currently tracking 474 gigawatts of new connection requests, approximately 90% of which come from data center projects.
Some of these queued projects are merely paper proposals. Due to lengthy grid interconnection wait times, many developers have chosen to secure a place in line early, with a large number of projects gradually being abandoned as they progress. Even if only a small fraction of proposed projects ultimately materialize, they could exceed the carrying capacity of the Texas grid. ERCOT's interconnection queue is now more than five times the state's peak grid demand.
Data from the Energy Information Administration (EIA) shows that although data center operators such as Google and Microsoft value Texas's abundant natural gas reserves, wind and solar power have actually helped ERCOT keep pace with growing electricity demand. Between 2021 and 2025, utility-scale solar capacity in Texas quadrupled. Additionally, according to a report from energy data analytics firm Amperon, Texas electricity prices were on a downward trend for most of this period.
Compared with other states, Texas electricity prices remain relatively affordable, but they have begun to rise. The EIA notes that data centers and cryptocurrency mining facilities are the primary factors driving up Texas electricity prices. Abbott clearly wants to curb this trend and has directed PUCT and ERCOT to collect detailed information on proposed data centers, including on-site and off-site electricity and water demand, noise mitigation measures, lighting control plans, tax incentive usage, and project ownership structures.
Texas has historically maintained a more permissive approach to development regulation than most U.S. states—Houston is known for having no zoning ordinances—and the state has long fostered a business-friendly regulatory environment. However, data centers have become a point of contention across the country, and Texas is no exception. Abbott previously attempted to guide data center companies to disclose relevant information through voluntary surveys, but most companies did not respond, making this audit a mandatory compliance measure.
The audit results will determine whether Texas's appeal as a data center hub can endure.
