Core Summary

  • BloombergNEF (BNEF) analysts said on Wednesday that Texas's suspension of data center grid interconnection reviews will put about 20% of the total national data center construction pipeline at risk of delay. The analysis follows the Lone Star State's recent decision.
  • Texas Governor Greg Abbott, a Republican, implemented the moratorium on Monday, affecting nearly 49.8 gigawatts of projects. Abbott called for an audit of all data centers in the Electric Reliability Council of Texas (ERCOT) interconnection queue, prompting the grid operator to postpone reviews of the first batch of projects applying under the state's new large-load interconnection process.
  • BNEF noted that assuming 60% of the delayed capacity is related to artificial intelligence (AI), data center revenue losses could reach $8 billion by the first quarter of 2027. Risks will rise further if the moratorium extends into the 2027 Texas legislative session, as lawmakers may consider modifying the new interconnection process.

Deep Analysis

BNEF said the financial impact of the Texas data center moratorium could be "significant." The energy research firm projects that total new ERCOT data center capacity will be about 1.2 gigawatts from the second quarter of this year through the first quarter of 2027.

"Delays in energization during this period could put billions of dollars in data center lease revenue at risk," BNEF said. The firm's analysis estimates that AI computing capacity can generate about $1.76 billion in revenue per gigawatt per month.

"If interconnection policy changes in the next term, potential revenue losses for data centers could reach billions of dollars," BNEF said.

In a letter Monday calling for an audit of data center proposals, Abbott noted that total ERCOT interconnection queue requests are about 474 gigawatts. "About 90% of new electricity requests come from data centers," he said.

The queue size is more than five times ERCOT's peak demand record, highlighting both the scale of construction and the possibility of duplicate or excessive interconnection requests. BNEF expects ERCOT to add about 8.25 gigawatts of data center capacity by 2030, bringing the total above 17 gigawatts. The firm noted that of the roughly 50 gigawatts of Texas data center projects it tracks, more than 70% remain in early stages.

The firm said that if ERCOT's initial studies for large-load projects—known as the "batch zero" process—proceed as planned, the 2030 forecast "could be significantly revised upward." But the new audit could cause delays.

Abbott's audit will review the following: whether data centers self-generate power or rely on the grid; their water usage; and which data centers are utilizing state or federal assistance, such as tax incentives, grants, or tax abatements.

"Any data center project that fails to pass the verification and audit process to protect the reliability and resilience of the Texas grid must be rejected," the governor said in the letter.

Texas's moratorium follows New York State, which in July suspended new data center approvals for up to one year while developing new rules.