Texas grid operator pauses all new AI data center power grid approvals after requests reached 474 GW, citing reliability concerns.

Texas data center developers can continue building, but securing power from the state's main grid has become significantly more complex.

Governor Greg Abbott ordered the Public Utility Commission of Texas and ERCOT (the Electric Reliability Council of Texas) to pause approvals for data centers seeking connections to the grid until proposed projects complete a comprehensive audit. This action follows a surge in power requests that now exceed 474 GW, with data centers accounting for approximately 90% of the proposed load.

For cloud providers, AI developers, and infrastructure investors, the directive could mean longer approval timelines, expanded disclosure requirements, and greater project schedule uncertainty.

The audit will examine projected electricity use, on-site and off-site power generation, water demand, cooling operations, tax incentives, ownership information, and measures to mitigate noise, lighting, and other community impacts.

"Our top priority is to protect Texans' safety and quality of life," Abbott stated. "Any project that fails to comply with the requirements set forth by the PUCT and ERCOT, and by state law, must be denied connection to the Texas grid."

The Data Center Coalition, representing major technology companies, suggested the audit could help distinguish responsible developers without unnecessarily delaying compliant projects. "Done correctly, this review can showcase the good actors in the data center industry rather than delaying them unnecessarily, ensuring Texas will continue to be the national leader in economic development," said coalition spokesperson Dan Diorio.

Regulators have not disclosed how long the reviews will take or when approvals will resume. ERCOT's interconnection queue currently contains more than 1,800 proposed projects representing over 474 GW of requested power—more than five times the grid's record peak demand. This volume reflects developers' practice of joining interconnection queues early because grid access can take years, and many proposals never progress beyond planning stages. The queue grew from 233 GW in January to over 474 GW in less than six months.

The directive applies only to data centers seeking ERCOT grid access and does not affect facilities generating their own electricity or those planned outside ERCOT service areas, including El Paso. Texas operates at least 335 data centers with 248 additional facilities in development, making it the nation's second-largest data center market behind Virginia.

Developers should now account for extended approval timelines, detailed disclosure requirements, and the possibility of grid connection rejection. Companies planning Texas capacity should verify whether proposed sites depend on ERCOT connections and whether project schedules accommodate the new audit process. Operators should also review cooling designs, water projections, backup or on-site generation capabilities, local community requirements, and tax incentive arrangements.

The pause does not halt Texas data center expansion, but it introduces a new approval stage. Until regulators clarify the audit timeline and approval standards, developers should treat grid access as a project risk rather than a given.