Three major data center developers have agreed to comply with new Texas standards governing the rapidly expanding industry, Gov. Greg Abbott announced Wednesday, as the state moves to require large facilities to account for their demands on electricity, water, and local communities.
Google, Rowan, and CleanSpark have committed to the standards, according to an August 12 What Texas Is Requiring
The standards are aimed at addressing some of the biggest issues surrounding the state’s data center boom: electricity demand, infrastructure costs, water consumption, and the impact of large facilities on nearby communities. Under the framework announced by Abbott, data center developers must provide information to the Public Utility Commission of Texas and the Electric Reliability Council of Texas before projects can move forward. Among other requirements, developers must disclose taxpayer-funded incentives and other public financial assistance connected to a project, projected electricity demand, plans for on-site generation or other measures to reduce reliance on the ERCOT grid, and information about water sources and projected water use. They also must provide information about water reuse and water-efficient cooling technologies. The state is requiring developers to address potential effects on surrounding property owners, including noise, lighting, setbacks, traffic, and emergency response. The governor’s office said projects also must disclose ownership and controlling interests. The PUCT and ERCOT are responsible for auditing the information. “I established clear guardrails to ensure data centers protect our electric grid, conserve our water, respect our neighborhoods, and pay their own way,” Abbott They must not pass costs on to Texas families or interfere with their quality of life.” Data centers have become one of the fastest-growing sources of new electricity demand in Texas, driven in part by cloud computing and artificial intelligence. ERCOT’s new large-load process applies to projects seeking at least 75 megawatts of electricity. In June, the ERCOT board and PUCT approved a new “Batch Zero” process designed to evaluate large electricity users collectively rather than handling every project independently. ERCOT said the process is intended to determine where large users can connect without compromising grid reliability and to identify transmission upgrades that may be necessary. The organization said the projects in the initial batch are expected to be classified in August, while a final transmission plan covering the batch is expected in fall 2027. ERCOT also cautioned that not every interconnection request ultimately results in a facility being built. The new requirements have already affected at least one proposed project. On July 23, Abbott announced that Diode had withdrawn plans for a data center near Cedar Creek Lake in Henderson County. According to the governor’s office, Diode notified Henderson County officials that the project did not meet the governor’s directives or community expectations. “Data centers that want to do business in Texas must meet a clear standard. This project did not,” Abbott Texas requires companies to put communities first, protect our natural resources and power grid, and respect the quality of life of our residents. Diode did the right thing by withdrawing their project. If other data center developments refuse to meet these standards, I expect them to do the same.” The withdrawal came after Abbott issued a June 10 directive to the PUCT and ERCOT concerning data center development. In that directive, Abbott called for measures designed to prevent data centers from shifting development costs and risks onto Texas residents, encourage sustainable resource management, and reduce effects on surrounding communities. The governor’s office said Google, Rowan, and CleanSpark have committed to the standards and guidelines. Each has publicly confirmed their support of Abbott’s directive, with Google stating the following: Our statement on Governor Abbott's data center directives: pic.twitter.com/Cj3p8xIhfp — Google Public Policy (@googlepubpolicy) August 10, 2026 The announcement is significant because the companies represent different portions of the data center and technology landscape, while Texas continues to attract large-scale digital infrastructure projects. Rowan, in particular, has been pursuing multiple Texas facilities. A proposed sixth data center in Temple was still moving through the development Texas Is Trying to Balance Growth and Infrastructure
The state’s approach does not prohibit data center development. Instead, it establishes conditions for projects seeking to connect to the Texas electric grid. ERCOT manages the flow of electricity for more than 27 million Texas customers and oversees a grid containing more than 55,000 miles of transmission lines, according to the organization. The issue is particularly important as Texas considers how to accommodate rapidly increasing electricity demand while maintaining reliability. The governor’s June directive also called for legislation addressing who pays for electric infrastructure associated with data centers, requiring new facilities to add electric capacity rather than only demand, encouraging water-efficient technologies, requiring annual reporting of electricity and water use, and reconsidering certain tax incentives. For now, the next step is the review process. The PUCT and ERCOT must receive and audit the required information before covered data center projects can move forward, and companies that fail to Wednesday’s announcement therefore marks another step in Texas’ evolving effort to accommodate the state’s data center expansion while requiring developers to account for the electricity, water, infrastructure, and community impacts associated with that growth. The Dallas Express has closely followed the rapid growth of data centers in Texas, including their effects on the state’s electric grid, water resources, and surrounding communities. For additional coverage, read the following: Provided by Dallas Express
Why the Rules Matter
One Texas Project Already Walked Away
Google, Rowan and CleanSpark Move Forward
Prior Coverage
