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Texas policy clash
President Donald Trump criticized Texas’ data center policy, and Gov. Greg Abbott responded by touting major technology companies’ cooperation after Abbott issued a temporary moratorium on data centers.
“"I established clear guardrails to ensure data centers protect our electric grid, conserve our water, respect our neighborhoods, and pay their own way,"”
Abbott said, "I established clear guardrails to ensure data centers protect our electric grid, conserve our water, respect our neighborhoods, and pay their own way," and he directed that no new data centers could connect to the Texas power grid until state regulators conducted a thorough review.
Ars TechnicaIn an interview with Punchbowl News, Trump said, "I saw Texas the other day sort of is against data centers," and he added, "I think that's a mistake."
Abbott’s directive also required data centers to bring their own energy infrastructure to Texas and reduce their water usage, and Meta said it pays for its own infrastructure to connect data centers to the power grid.
The Houston Public Media report said data centers are requesting 474 gigawatts of energy from the Texas power grid over the next few years, more than five times the amount of energy used to power the entire state during record-breaking demand.
Companies pledge compliance
Abbott’s office said major technology companies signaled willingness to comply with the governor’s directives, including OpenAI’s pledge to pay for its own infrastructure, support new sources of electricity in Texas, and minimize water usage.
Google also touted a "$40 billion investment" in Texas infrastructure and jobs, and a Google spokesperson said, "We share Gov. Abbott's commitment to ensure data centers are developed the right way and support high standards for data center providers."
In a letter to the governor, OpenAI pledged to pay for its own infrastructure, and the report said Amazon sent a letter promising to comply with Abbott’s standards for data centers.
Austin state Rep. Gina Hinojosa, the Democratic nominee for governor, urged Abbott to call a special legislative session, saying, "We need a moratorium on data centers until the legislature can meet to put in place real protections so Texans can have a seat at the table."
Hinojosa added, "When the companies being regulated are cheering for the rules, you know the rules were written for them, not for Texans."
Finance and public backlash
While Texas politics and company pledges unfolded, the U.S. Securities and Exchange Commission made it easier for data center owners to sell asset-backed securities, Reuters reported on Aug 10.
“"We agree that the fixed-income or other securities issued in data center securitizations"”
The SEC clarification came in response to a letter from law firm Latham & Watkins, and the regulator said, "We agree that the fixed-income or other securities issued in data center securitizations of the type described in your (Latham & Watkins's) letter are not asset-backed securities," according to Reuters.
CNN framed the broader political fight as a split between Trump’s embrace of data centers and public opposition, noting that Trump’s administration officials were "bear-hugging" them even as lawmakers and candidates positioned themselves as critics.
CNN also quoted Trump saying, "They need some PR help, because people think that if a data center goes in there, electricity prices are going to go up," and it cited Reuters-Ipsos polling showing Americans opposed construction of new data centers 45%-16% in June.
The same CNN report said Gallup in March showed 7 in 10 Americans opposed building data centers "in your area," and it added that a Marquette Law School poll in May found Americans said 71%-29% that the costs of data centers outweighed the benefits.