Texas data center grid impact sparks legislative testimony

Texas energy leaders answer questions on data centers

Texas could be the nation's leader in data centers by 2030, and that's forcing energy companies like ERCOT to reevaluate if the grid can handle that level of growth. FOX 4's Alex Boyer has more on what Texas energy leaders said to Texas lawmakers at a hearing today.

DALLAS - State lawmakers met to discuss the state’s booming data center industry. But that has some questioning whether the grid can handle the added data centers.

What we know:

Texas is expected to lead the nation in the number of data centers by 2030.

According to the Electric Reliability Council of Texas, data center projects have been growing rapidly over the past year and a half.

That’s forcing ERCOT to re-evaluate the way these projects are approved in the future.

What they're saying:

ERCOT President and CEO Pablo Vegas testified before the Texas House Committee on State Affairs on Thursday morning. He was joined by the chairman of the Texas Public Utility Commission.

Vegas said nearly 90% of new project requests entering the queue are for constructing new data centers. The massive computer farms generate data for artificial intelligence, but also demand resources like water and power.

"If the grid gets into an emergency situation, data centers have to come off of the grid and use their own backup generation that they have and not add to the burden of the grid during a scarcity or emergency event," he said.

Lawmakers asked the men about their concerns. They also want to make sure residents aren’t on the hook for these massive projects.

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"Is it the goal of the commission to make sure the data center activity does not increase the electricity cost for our constituents?" Rep. Chris Turner asked.

"Yes, we are working to establish a framework that adheres to cost causation principles – that those who cause the cost pay the cost," said Texas PUC Chair Thomas Gleeson. "The companies we’ve talked to are committed to not having residential rate payers bear the cost of this."

The other side:

Executives from several data centers testified as well. They all said they are committed to being good neighbors.

One testified that his company uses a closed-loop water system at its data centers, adding that its facilities use less water than an average hotel.

What's next:

The chair of the PUC said he expects there to be a lot of discussion about data centers at its meeting next Friday.

The Texas Committee on State Affairs plans to hold another meeting at a later date for members of the public to weigh in.