Texas Governor Greg Abbott ordered a full audit of the state's 474-gigawatt data center interconnection queue and threatened to deny grid access to new projects pending completion.
Texas Governor Greg Abbott has directed the Public Utility Commission of Texas (PUCT) and the Electric Reliability Council of Texas (ERCOT) to conduct a comprehensive audit of every data center advancing through the state's interconnection queue. In an August 3 letter to PUCT Chairman Thomas Gleeson and ERCOT President and CEO Pablo Vegas, Abbott warned that projects failing to disclose ownership, financial, water, and community-impact information could be denied grid access.
The directive is tied directly to non-compliance with existing state law. Abbott wrote that "the failure of some data centers to comply with the PUC's survey measuring water and power usage under the General Appropriations Act makes this necessary," noting that "failure to fully comply with that law hinders your ability to make fully informed decisions." He stated that "our top priority is to protect Texans' safety and quality of life," and declared that "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 timing reflects an unprecedented surge in demand. The ERCOT large-load interconnection queue has grown to 474 GW—approximately 90% of which is data centers, according to testimony ERCOT delivered July 29 to the Texas Senate. Abbott noted this represents "more than five times Texas' record peak electricity demand for ERCOT," referencing the all-time hourly peak of 91,089 MW that ERCOT set on July 22, 2026. "That unprecedented load growth could endanger the reliability and stability of the Texas electric grid," he wrote.
This represents Abbott's second intervention in less than two months. On June 10, 2026, Abbott issued three directives to the two agencies: ensure that data-center interconnections result in reduced residential electric bills, require data centers to pay for all electric infrastructure costs so residential ratepayers are not burdened, and review existing PUCT and ERCOT authority to identify further consumer safeguards. He set two deadlines—a joint memorandum due July 17 and PUCT action to reduce residential ratepayer transmission costs by July 31—and pledged to pursue six legislative items in the 2027 session: codifying that data centers pay their own infrastructure costs, requiring data centers to add to Texas' electric capacity rather than only demand, mandating water-efficient technologies such as closed-loop cooling systems, requiring large data centers to annually report electricity and water usage to the PUCT, repealing sales-tax exemptions and other incentives, and requiring data centers to reduce community impacts through setbacks and noise-reduction technology.
These directives build on Senate Bill 6 (SB 6), signed by Abbott in June 2025, which overhauls how large-load customers of 75 MW or more interconnect to the ERCOT grid. SB 6 amends the Public Utility Regulatory Act (PURA) to direct the PUCT to establish interconnection standards for large loads at that 75 MW threshold, requires applicants to disclose whether they are pursuing substantially similar interconnection requests elsewhere in Texas and any on-site backup generation capable of serving at least 50% of facility demand, and requires financial commitments and site control before ERCOT will study a project. The statute also authorizes ERCOT, once emergency criteria are defined, to instruct qualifying large loads with dedicated behind-the-meter backup generation to curtail net consumption during grid emergencies. Additionally, SB 6 requires transmission service providers to curtail non-critical new large loads energized after December 31, 2025 during firm load-shed events, governs net-metering arrangements between new large loads and generation resources registered with ERCOT before September 1, 2025, and directs the PUCT to reexamine wholesale transmission cost allocation and require new large loads to contribute to interconnection cost recovery. The statute took effect immediately on June 20, 2025, with PUCT implementation required by December 31, 2026.
The PUCT is executing SB 6 through five dedicated rulemakings. In February 2026, the commission adopted 16 TAC §25.370, setting minimum standards for information utilities must submit before ERCOT includes a proposed large load in its forecast. In March 2026, it adopted 16 TAC §25.205, requiring PUCT approval before new large loads can be net-metered with any generation resource registered with ERCOT before September 1, 2025. Three additional rulemakings remain in progress: interconnection standards in Project 58481, a demand-management reliability service in Project 58482, and a follow-on transmission-cost recovery rulemaking in Project 58000. Commission Chairman Gleeson told Abbott in July that a final Project 58481 rule would be considered "later this summer."
Eight days after Abbott's June 10 letter, on June 18, the PUCT approved ERCOT's Batch Study framework, built through Nodal Protocol Revision Request NPRR1325 and Planning Guide Revision Request PGRR145. The framework groups qualified large-load projects of 75 MW and above into a single interconnection study and requires each applicant to post financial security of $50,000/MW by July 10, 2026, to remain eligible. According to ERCOT's testimony on July 29, approximately 205 GW of large-load requests are eligible for inclusion in Batch Zero based on existing studies—65 GW as base load, 114 GW as allocated load, and 25 GW awaiting final determination. The framework is designed to deliver annual megawatt allocations from 2028 through 2032, transparency on interconnection and upgrade costs, and a coordinated transmission plan identifying required upgrades.
ERCOT plans to issue classifications by August 7, complete dispute, security-reconciliation, and data-correction processes by September 1, and begin the Batch Zero interconnection study no later than September 2. Study results are scheduled for April 9, 2027, followed by interconnection agreements and final capacity allocation confirmation by June 8, 2027. Projects excluded from Batch Zero—because they cannot post financial security or otherwise meet eligibility criteria—will be considered in a subsequent round referred to as Batch One, though its start date and criteria are still under development. On July 30, the PUCT advanced Project 58482 to Proposal for Publication, with a September 4 comment deadline.