What just happened? Texas has put a hold on new data center approvals that require access to the state's grid, a move that could slow a long list of projects already waiting in line. Governor Greg Abbott has ordered the Public Utility Commission of Texas and ERCOT to pause approvals until the agencies complete an audit of applicants, a move that could stall a large backlog of projects seeking to connect.
The state wants more information before granting access. Abbott said applicants must provide tax break details, power use and generation data, water use and cooling plans, steps to reduce community impact, and facility ownership information. Any project missing that information will not be allowed onto the grid.
"Our top priority is to protect Texans' safety and quality of life," Abbott wrote. "Any project that fails to comply with the requirements set forth by the PUCT (Public Utility Commission of Texas) and ERCOT (Electric Reliability Council of Texas), and by state law, must be denied connection to the Texas grid. Simply put, Texans must come first."
The review appears to follow a PUCT survey that most companies ignored. The agency said it asked 377 data center firms for information on water and power use, but only 28 responded.
The order isn't a statewide ban, but it still affects a major chunk of the projects in ERCOT's queue. More than 1,800 projects are waiting for approval to connect, and about 90% of them are data centers. Together, those applications could require 474 gigawatts, which is far above ERCOT's current peak demand.
Even so, the directive does not hit every project in Texas. Data centers outside ERCOT's territory, including those in El Paso, are not covered. Projects that bring their own power are exempt too, since they don't need to connect to the grid.
The move drew criticism from opponents pushing for the legislature to step in with stricter rules. Texas Agriculture Commissioner Sid Miller called the directive "all hat and no cattle" on the Texas Department of Agriculture's official Facebook page, saying, "Texans need laws with teeth, not another press release designed to make it look like something is being done while hyperscale projects continue moving forward."
State Rep. Gina Hinojosa, who is challenging Abbott in the 2026 governor's race, dismissed the move as too little, too late. She said Abbott has spent months promoting Texas as a friendly place for data centers, and argued his new pause wouldn't convince anyone the state is suddenly cracking down.
The Texas move is narrower than New York's statewide data center moratorium, but it still adds a major hurdle for developers. For an industry built around fast buildouts and heavy power demand, the pause could have immediate effects.