Texas halts ERCOT data center approvals for Abbott-ordered audit

Texas has become a hotspot for AI data centers largely because of power availability and low operating costs, but its grid is almost entirely isolated from other states. That isolation was a significant factor in the largest controlled outage in U.S. history during Winter Storm Uri in 2021, and it limits how much power the state can import when demand surges.

The pressure is visible in the numbers. The July 22, 2026 peak demand of about 91.1 gigawatts is already an all-time high, yet current project proposals—roughly 90% of the requested power coming from data centers—total more than five times that peak. Those requests exposed both generation limits and ineffective demand forecasting, pushing ERCOT to introduce its Batch Zero screening process because reviewing each request individually was taking too long.

Lawmakers responded with Senate Bill 6, signed by Gov. Abbott on June 20, 2025, which shifts infrastructure upgrade costs onto AI data center developers instead of ratepayers and could require shutdowns during emergencies. The follow-on audit now puts the Batch Zero process on delay, so the next phase for developers will likely be shaped by how strictly ERCOT re-screens the queue, with the state aiming to keep supply stable.