In an interview with Punchbowl News in early August, President Donald Trump<\/a> called data centers \u201ctremendously important\u201d while acknowledging Americans\u2019 unease about the ongoing buildout.<\/p>\n Read More on Tech<\/p>\n \u201cWhoever wins AI just wins. It’s that big. It’s bigger than the internet by many times. It’s gonna be bigger than anybody ever thought possible. Not even imaginable how big,\u201d the president said. \u201cI saw Texas the other day sort of is against data centers. I think it’s a mistake.\u201d<\/p>\n Texas\u2019s Data Center Boom<\/p>\n In a recent note, Torsten Slok, chief economist at Apollo Global Management, described America\u2019s \u201cdata center boom” as “a Texas Story.\u201d he cited research from the market intelligence platform Cleanview, which found that Texas\u2014while second to Virginia in current operating capacity\u2014now accounts for more planned capacity by megawatts (94,656 MW) than the next three states combined.<\/p>\n \u201cTexas remains well positioned to maintain its leadership, but continued success depends on clear, predictable standards that support responsible investment,\u201d CyrusOne, a company which currently boasts 15 data centers in Texas, told Newsweek. \u201cMaintaining that leadership will help sustain job creation, workforce development, local tax revenue and the infrastructure needed to support the state\u2019s continued economic growth.\u201d<\/p>\n Ray Perryman, president and CEO of The Perryman Group, an economic research and analysis firm based in Waco, Texas, likewise described them as a \u201cmajor source of investment throughout Texas,\u201d but one which community opposition could complicate.<\/p>\n Though he believes the momentum Texas has so far generated will be maintained thanks to favorable land and business conditions, Perryman said that, \u201cas with anything that is sudden and different, there are very real \u2018growing pains\u2019 and issues which must be addressed.\u201d<\/p>\n Concern At the State Level<\/p>\n As Trump acknowledged in his interview with Punchbowl News, Texas leadership has in recent weeks shifted from championing data centers and the AI push to skepticism<\/a> over water concerns, community impacts and the potential implications for the state\u2019s grid.<\/p>\n In June, Governor Greg Abbott<\/a> called for new regulations governing data center construction and operation, including a requirement that the facilities pay their own infrastructure costs and provide additional power generation to avoid this burden shifting to Texans.<\/p>\n Earlier this month, Abbott, a Republican, ordered a pause on pending interconnection requests for new projects until ERCOT and the Public Utility Commission of Texas could conduct a comprehensive audit of all planned data centers in the state.<\/p>\n \u201cThe Governor established clear guidelines: Data centers must invest their own money, provide their own power, reuse their own water, ensure that the power grid is gaining power\u2014not losing power because of their operations\u2014and must not disturb neighborhoods,\u201d Andrew Mahaleris, Governor Abbott\u2019s press secretary, told Newsweek. \u201cData centers across the state have announced their full compliance with those standards, which provide guardrails that protect our communities.\u201d<\/p>\n This came after a poll by Texas Public Opinion Research found that 79 percent of Texans supported AI data centers being forced to disclose their water consumption, with 75 percent in favor of centers funding their own grid upgrades.<\/p>\n But some, like President Trump, have spoken against any rules that could slow the construction of new data centers, which he dubbed \u201cbig, strong, bold, and Money Machines for the State in which they are built.\u201d Trump’s administration has, however, pushed local leaders, electricity companies and tech firms to sign a voluntary \u201cRatepayer Protection\u201d pledge aimed at protecting consumers from higher utility bills as a result of the data center buildout.<\/p>\n Texas generated $4.5 billion in tax revenue from data centers in 2024, according to a PwC analysis commissioned by the Data Center Coalition, the primary trade association representing the industry. However, these revenues remain subject to significant debate given the tax breaks used to incentivize construction within Texas\u2014which the state comptroller\u2019s office estimated could mean foregoing over $1 billion each year, the Texas Tribune reports.<\/p>\n \u201cThe largest benefit of data centers, or any capital-intensive investments are the tax revenues they generate for local communities,\u201d Nathan Jensen, a professor of Government at the University of Texas at Austin, told Newsweek. \u201cThe problem is that states and local communities often give tax breaks for these projects, erasing many of the benefits.\u201d<\/p>\n Local Opposition Grows<\/p>\n Alongside increasing skepticism from officials, opposition to data center expansion continues to grow at the grassroots level in Texas. <\/p>\n Facebook groups like Texans United Against Data Centers or the Texas Coalition Against Datacenters boast tens of thousands of members who routinely and publicly object to the facilities on environmental grounds, while organizing how to delay or prevent further developments.<\/p>\n Green Recursive Utility Service LLC, a Texas-registered public data utility, has petitioned the state\u2019s Public Utility Commission to establish measurement standards and regulatory frameworks for data center resource consumption. The company told Newsweek that data centers \u201ccan place extraordinary demands on Texas’s infrastructure” while straining its water resources, and said that this \u201cdirectly affects the cost everybody pays, raising utility rates for all Texans.\u201d<\/p>\n \u201cThe public is very concerned about water, energy, and quality of life impacts,\u201d said Margaret Cook, vice president for Water & Community Resilience at the Houston Advanced Research Center. Cook told Newsweek that on top of these impacts, the \u201clack of transparency\u201d from the industry was also proving to be a significant \u201cengagement barrier\u201d for Texas communities.<\/p>\n Developers themselves have acknowledged the source of this opposition while tacitly endorsing Abbott\u2019s new measures.<\/p>\n \u201cWe understand why communities are asking more questions as the data center industry grows,\u201d CyrusOne told Newsweek. \u201cData centers are highly secured facilities and cannot easily be opened to the public, so many people understandably have limited familiarity with how they are designed and operated.\u201d<\/p>\n The company said it would be \u201cpremature\u201d to comment on the ongoing audit before it is complete, but said it supports the governor\u2019s \u201ccommitment to ensuring Texas\u2019 growth protects grid reliability, conserves water resources, and puts families and communities first.<\/p>\n \u201cWe believe the policies Governor Abbott is advocating for will ensure that economic development can coexist with environmental protection and community contributions,\u201d said Raul Martynek, CEO of DataBank, which operates an extensive network of data centers in Texas.<\/p>\n \u201cTexas built its lead by becoming a leader in energy, information technology, and economic growth at the same time; one audit doesn\u2019t undo that,\u201d he added.<\/p>\n And some experts likewise believe a middle ground can be reached which captures the economic benefits of data center development while addressing community-level concerns over power demand, environmental impacts and Texans\u2019 quality of life.<\/p>\n \u201cMany companies have already announced their intentions to comply with the governor’s plan,\u201d Cook told Newsweek. \u201cI think we can protect quality of life\u2014and even improve on it\u2014while still growing Texas’s economy<\/a> if the industry improves.\u201d<\/p>\n Contact Newsweek editors on this story: Daniel Orton <\/a>and Gray R. Thomas<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Texas is leading the way when it comes to data center development in the U.S., but local opposition…\n","protected":false},"author":2,"featured_media":410708,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[4267,3436,8072,5304,145,918,2099,392,27,29,28],"class_list":["post-410707","post","type-post","status-publish","format-standard","has-post-thumbnail","category-texas","tag-ai","tag-artificial-intelligence","tag-businesses","tag-data-centers","tag-donald-trump","tag-economy","tag-freemium","tag-greg-abbott","tag-texas","tag-texas-headlines","tag-texas-news"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts\/410707","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/comments?post=410707"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts\/410707\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/media\/410708"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/media?parent=410707"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/categories?post=410707"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/tags?post=410707"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"Governor](\"https:\/\/www.newsbeep.com\/us-tx\/wp-content\/uploads\/2026\/08\/GettyImages-2280560027.jpg\"\/)
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