Texas data center approvals may stay paused until new laws pass
Governor-elect Gina Hinojosa plans to extend the halt on permits until the legislature acts in January, citing community concerns over power and water.
By Mei Lin ·
New data center projects in Texas will likely remain on hold until the state legislature passes new laws next year. Governor-elect Gina Hinojosa indicated she intends to extend the current pause on approvals, a move that goes further than the temporary freeze implemented by outgoing Governor Greg Abbott. Hinojosa won the governor's race on Tuesday, securing a victory that aligns with growing local opposition to the rapid expansion of these facilities.
The current pause, issued by Abbott starting in August, applies to environmental permitting and grid connections while regulators conduct an audit. That audit is scheduled to be completed by the end of this year. Hinojosa's proposed moratorium would last until the Texas Legislature convenes in January. She aims to use that session to pass protections that give residents a direct role in deciding whether data centers operate in their neighborhoods.
During the campaign, Hinojosa outlined specific requirements for the industry. Her plan includes requiring operators to hire union workers and protecting local water supplies. She also proposed ending the use of nondisclosure agreements, which currently prevent the public from tracking project details. Hinojosa stated in a September interview with Politico that economic development and protections for residents are compatible goals.
The shift in state policy comes after grassroots opposition grew across Texas. Critics from both political parties raised concerns about the massive electricity draw and uncertain water usage of data centers in a state prone to drought. Kathryn Guerra, the Texas Commission on Environmental Quality watchdog campaign director for Public Citizen, noted that the election result reflects widespread frustration. She said the state is now in a position to listen to Texans and address concerns raised during the past year of rapid development.
Industry representatives responded to the election result with statements affirming their commitment to the state's digital infrastructure. Jess Heck, director of government affairs in Texas for the Data Center Coalition, said the industry looks forward to working with state leadership to support responsible growth. Meanwhile, Elon Musk, who supported Abbott, posted on X that data centers in space are becoming an appealing option.
Hinojosa will take office on January 19. She will work with a Democrat-dominated Texas House to implement her agenda. The previous administration demanded that data centers pay for their own electrical infrastructure and use water-efficient technology. The new governor-elect plans to pursue similar measures while adding new regulatory layers.
The legislative session begins in January. Lawmakers will review the data collected during the current audit, which includes information on tax incentives, water use, and neighborhood impacts. Hinojosa's administration will rely on this session to formalize the moratorium into permanent law or continue the pause if legislation is not passed.
