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Texas: Governor Abbott Directs TCEQ To Halt Data Center Permits

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~ In a recent directive, Governor Greg Abbott has ordered the Texas Commission on Environmental Quality (TCEQ) to put a halt on all permits sought by data centers until the Electric Reliability Council of Texas (ERCOT) completes its audit. This decision comes as a measure to prioritize the well-being of Texans and ensure that data centers are held accountable for their impact on the state's resources.

According to Governor Abbott, data centers must pay their own way and protect the grid and water resources before moving forward with any development. He stated, "Simply put, Texans must come first." The Public Utility Commission of Texas (PUCT), ERCOT, and the Texas Water Development Board (TWDB) require information from these audits in order to make informed decisions regarding data center development.

Governor Abbott has also directed PUCT and ERCOT to conduct audits on all data centers currently undergoing ERCOT's interconnection process. This is to ensure that their development does not compromise the reliability of the Texas electric grid or put natural resources at risk. Additionally, on September 14th, he directed TWDB to enforce water-use reporting requirements for data centers and partner with ERCOT on the audit to obtain more information.

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The impact of data centers on grid reliability and security, as well as water resources needed by Texas communities, will be determined by PUCT, ERCOT, and TWDB. In order for data center projects to move forward, they must cover all electrical infrastructure costs, result in lower residential electrical bills, and complete the ERCOT audit. They must also not use water needed by local communities and abide by setback requirements that protect surrounding areas.

As ERCOT and TWDB conduct their audits, TCEQ is expected to align its permitting decisions with Governor Abbott's directives and utilize information from these audits. The agency has been given a deadline of Monday, October 19th to provide an update on its compliance with this directive.

Governor Abbott has also announced plans to work with the Legislature to eliminate any financial incentives for data centers in the next session. In a letter to TCEQ Executive Director Kelly Keel, he emphasized the importance of prioritizing the well-being of Texans and ensuring that data centers are held accountable for their impact on the state's resources.

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