# Texas Directs TCEQ To Halt Data-Center Permits Amid AI Boom By Riza Dagoc Canonical URL: https://www.tokenpost.com/news/regulation/28152 Published: 2026-10-08T14:09:17.000Z Updated: 2026-10-08T14:09:17.000Z Section: Regulation > The directive pauses permits pending an ERCOT audit and adds reviews of grid costs, electricity use and water demand as data-center power needs rise. Texas Gov. Greg Abbott directed the Texas Commission on Environmental Quality (TCEQ) to halt data-center permits pending an Electric Reliability Council of Texas (ERCOT) audit, adding pressure to an industry driving projected U.S. power demand higher. Data centers could consume 11.8% of U.S. electricity by 2030, with possible outcomes ranging from 9.5% to 15.3%. The reference case calls for 649 terawatt-hours (TWh) of data-center electricity use that year. Texas is facing a particularly large wave of proposed electricity demand. About 400 large-load interconnection requests totaled 239,000 megawatts (MW) in February, equal to 2.8 times ERCOT’s record system peak. By June, more than 438,000 MW of large-load requests were being tracked, with nearly 89% tied to data centers. ERCOT has created a batch-review process for qualifying projects of at least 75 MW. The system evaluates groups of projects together, allocates available grid capacity and identifies transmission upgrades needed for connections. Abbott’s Sept. 21 directive halts TCEQ permits pending ERCOT’s audit and requires additional reviews by the Public Utility Commission of Texas and the Texas Water Development Board. Projects must cover electrical-infrastructure costs, disclose electricity and water use, complete the ERCOT review and avoid using water needed by local communities. “Simply put, Texans must come first,” Abbott said. The directive pauses TCEQ permitting while the reviews proceed, but it does not create a permanent statutory statewide construction moratorium. TCEQ must provide a compliance update by Oct. 19. The policy adds a regulatory layer to infrastructure challenges already facing AI developers. New computing campuses require generation, substations, transformers and transmission lines capable of delivering power at a large scale. The pressures are consistent with [earlier concerns about U.S. data-center power markets](), where long grid-connection timelines have raised reliability risks. “This new process represents a fundamental shift in how ERCOT manages the significant growth of large load interconnection,” ERCOT President and CEO Pablo Vegas said. The national electricity projections vary with assumptions about equipment shipments, server utilization, cooling efficiency, facility locations and the number of projects ultimately built. In Texas, the next concrete step is TCEQ’s compliance update due Oct. 19. ## Links in this article - [earlier concerns about U.S. data-center power markets](https://www.tokenpost.com/news/technology/23545)