Greg Abbott Seeks Laws to Restrict Texas AI Data Centers

Governor Greg Abbott announced plans to have the Texas Legislature codify restrictions on AI data centers into law next year. The proposed regulations would require facilities to fund their own electrical infrastructure, use water-efficient cooling, report resource consumption, and limit noise disruptions. Abbott also seeks to eliminate sales tax breaks and other incentives, arguing that companies must fund their own projects and not invade rural neighborhoods.

These proposals follow an August order by Abbott to pause some data center approvals pending a review of their impact on the state's water and power grids. While other Republicans, including Donald Trump and Ted Cruz, have warned that overregulating AI could benefit China, Abbott maintains that Texas can restrict these facilities without undermining national competitiveness.

Democratic gubernatorial challenger Gina Hinojosa has dismissed the governor's actions as "just words," arguing that Texans lack a voice in deciding how these facilities enter their communities. Hinojosa has called for a formal moratorium on development until stricter legal guardrails are established to protect electricity and water costs. The dispute has become a central issue in the race for governor ahead of the November 3 election.