Texas Governor Seeks to Shield Households from Data Center Power Costs

Texas Governor Greg Abbott has signaled a shift in the state's approach to its booming data center market. In a letter to the state's energy regulator in June 2026, Abbott asked the Public Utility Commission and grid operator ERCOT to prevent the costs of new data center connections from burdening Texas households.

"The pace of data center development requires oversight so that the Texans who work every day are not burdened with the infrastructure costs stemming from data center expansion," Abbott wrote. This move is significant because Texas has long been positioned as a prime location for technology investments, and even its government is now acknowledging the hidden costs of the AI boom.

The issue of who bears the financial responsibility for this growth is no longer theoretical. It is being debated in U.S. legislatures, litigated in regulatory processes, and addressed by energy ministries worldwide. The sheer scale of electricity required by data centers, especially those powering AI, is staggering. Goldman Sachs Research estimates U.S. data centers consumed 31 gigawatts in 2025 and will reach 41 gigawatts in 2026. Bloom Energy projects this demand could nearly double to 150 gigawatts by 2028.

This surge is driven by AI-specific hardware, which requires significantly more power per rack than traditional servers. The Dallas Federal Reserve Bank warns that if data center electricity demand doubles in the next five years as projected, U.S. electricity bills could rise by as much as 50%. Previously welcomed for bringing jobs and tax revenue, data centers are now facing growing public opposition, with research indicating that social resistance blocked or delayed $98 billion in U.S. data center projects between March and June 2025.

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The pace of data center development requires oversight so that the Texans who work every day are not burdened with the infrastructure costs stemming from data center expansion.