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Texas Pauses New Data Center Grid Connections, Hitting the Nation's No. 2 Market

Gov. Greg Abbott ordered ERCOT and the PUC to audit power and water use before approving new data centers. Dallas-Fort Worth has more in the pipeline than anywhere else in the state.

Wade Ramos

August 5, 20262 min read

Texas Gov. Greg Abbott. Photo: Gage Skidmore (CC BY-SA 3.0).
Texas Gov. Greg Abbott. Photo: Gage Skidmore (CC BY-SA 3.0).

Gov. Greg Abbott has paused approvals for new data centers seeking to connect to the Texas electric grid, ordering state regulators to audit the projects first.

Abbott sent the directive Monday, Aug. 3, in a letter to the Public Utility Commission of Texas and the Electric Reliability Council of Texas, which runs the grid serving most of the state. New projects cannot move through the interconnection process until those audits are done.

What the numbers look like

ERCOT is tracking more than 1,800 projects in its interconnection queue, representing over 474 gigawatts of requested capacity. That is more than five times the grid's record peak demand.

About 90 percent of the new connection requests are data centers, according to Abbott. The queue has grown quickly: it stood at 233 gigawatts in January, meaning it roughly doubled in under six months.

Why this lands hard in Dallas-Fort Worth

DFW is the second largest data center market in the United States, behind Northern Virginia. Analysts at JLL have projected Texas could pass Northern Virginia to become the largest market in the world by 2030.

Statewide, at least 248 data center projects are planned. North Texas alone accounts for 26 large campuses tracked between Sherman and Waco, and from Weatherford to Terrell, a mix of operating sites, active construction and approved or proposed projects.

The pause therefore falls hardest on the region with the most in the pipeline.

What regulators must collect

The audits require information on electricity demand, water use, on-site generation plans, noise mitigation, light controls, tax incentives claimed and ownership structure, along with potential effects on surrounding communities.

Abbott's office had previously asked for some of this voluntarily. Most operators did not respond, which is what prompted the mandatory approach.

A limit worth noting

The directive covers projects seeking to connect to the ERCOT grid. Some developers are building their own on-site generation, which lets a facility operate without a traditional grid interconnection. Those projects are not captured the same way.

No end date for the audits has been announced.

Sources

https://www.texastribune.org/2026/08/03/texas-data-center-project-audit-greg-abbott/

https://www.keranews.org/news/2026-08-04/data-center-approvals-in-texas-halted-until-audits-completed-gov-greg-abbott-says

https://techcrunch.com/2026/08/04/texas-halts-new-data-centers-as-governor-calls-for-audits/

https://www.houstonpublicmedia.org/articles/news/energy-environment/2026/08/03/558529/gov-greg-abbott-pauses-new-data-centers-until-ercot-puct-audit-energy-water-usage/

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Wade Ramos

Wade Ramos writes about community life, schools, public safety, and local events in Dallas.

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