Texas governor pauses new data center development pending audits - Institutional Real Estate, Inc.

Texas Gov. Greg Abbott has ordered state utility regulators to audit all data centers moving through the power grid approval process before any new projects can advance, effectively pausing new development across the state.

Abbott directed the Public Utility Commission of Texas and the Electric Reliability Council of Texas, known as ERCOT, to run a comprehensive verification of every data center in the interconnection queue. No new project moves forward until that review is done. The move follows a similar executive order from New York Gov. Kathy Hochul, who created what has been described as the nation's first statewide moratorium on new hyperscale data centers.

For Lubbock, that matters. West Texas has drawn serious interest from data center developers in recent years, drawn by land costs and available power, and any project tied into ERCOT's grid is now in a holding pattern. Folks here who have watched large industrial power users strain the regional grid through hot summers know that ERCOT's capacity math is not theoretical.

The audit puts a hard stop on a sector that had been moving fast, raising real questions about how many projects in the queue will survive scrutiny once regulators get a closer look at the numbers.