Young Republicans of Texas

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Resolution on Texan First Data Center Policy

Calls for data centers to bear their infrastructure costs and meet grid reliability, water conservation, taxpayer benefit, and community protection standards.

WHEREAS, super intelligence will shape the future of the American economy and national security, and the Trump administration has made building the data centers to support it a national priority; and

WHEREAS, Texas has become a destination for that investment and is home to more than 300 operating data centers; and

WHEREAS, Senate Bill 6 (2025) took first steps by requiring large loads to pay for their own interconnection and allowing ERCOT to curtail them in emergencies; and

WHEREAS, Governor Abbott has directed the Public Utility Commission and ERCOT to make data centers fund their own electric infrastructure, paused data center interconnections, and on September 21, 2026, directed the Texas Commission on Environmental Quality to halt data center environmental permits pending audits; and

WHEREAS, transmission costs in ERCOT are projected to rise from about $5 billion annually to more than $12 billion by 2033, adding $100 or more per year to the average household electric bill; and

WHEREAS, data centers in Texas used about 25 billion gallons of water in 2025, which could reach as much as 161 billion gallons per year by 2030, yet only about 30% of surveyed data centers reported their use; and

WHEREAS, the data center sales tax exemption now costs the state at least $1.3 billion per year, and a data center may qualify with as few as 20 permanent jobs; and

WHEREAS, the Republican Party of Texas 2026 Platform calls for data centers to finance their own water and infrastructure needs rather than shifting costs to property owners.

THEREFORE BE IT RESOLVED, that the Young Republicans of Texas affirm the importance of super intelligence, but call on state and local officials to put Texans first by adopting the following framework:

  1. Ratepayer protection. Codify in statute that data centers and other large loads bear the full cost of the generation, transmission, and grid upgrades needed to serve them.

  2. Grid reliability. Strengthen Senate Bill 6 by requiring large loads to bring or contract for new dispatchable generation, post financial commitments to clear speculative requests, and yield to homes and critical services in an emergency.

  3. Water security. Require large water users to report consumption under real penalties, include data center demand in the State Water Plan, and require closed-loop cooling.

  4. Taxpayer benefit. Reform the sales tax exemption by removing electricity from its coverage, strengthening job and wage requirements, and adding clawbacks and periodic legislative review.

  5. Community protection. Establish reasonable setback and noise standards and give local communities a meaningful voice before large projects proceed.

  6. Temporary pause, lasting standards. Support the Governor’s audits as a temporary measure rather than a permanent ban, publish results promptly, and enact these standards during the 90th Legislature.

Bibliography

  1. “Accelerating Federal Permitting of Data Center Infrastructure,” Executive Order of July 23rd, 2025, as summarized in “Trump Administration Issues Executive Order to Streamline Data Center Development”, White & Case LLP, July 2025, https://www.whitecase.com/insight-alert/trump-administration-issues-executive-order-streamline-data-center-development

  2. “Google to Invest $40 Billion in Texas Through 2027”, CNBC, November 14th, 2025, https://www.cnbc.com/2025/11/14/google-to-invest-40-billion-in-texas-through-2027.html

  3. “ERCOT Large Load Update,” presented to the Senate Committee on Business & Commerce, Electric Reliability Council of Texas, April 1st, 2026, https://www.ercot.com/files/docs/2026/04/01/ERCOT_LargeLoad_Update_April2026_B-C_-Hearing.pdf

  4. “ERCOT’s Large Load Queue Has Nearly Quadrupled in a Single Year”, Latitude Media, December 3rd, 2025, https://www.latitudemedia.com/news/ercots-large-load-queue-has-nearly-quadrupled-in-a-single-year/

  5. “Texas Senate Bill 6 Significantly Expands Regulatory Oversight Over Large Loads in ERCOT”, McGuireWoods, July 2025, https://www.mcguirewoods.com/client-resources/alerts/2025/7/texas-senate-bill-6-significantly-expands-regulatory-oversight-over-large-loads-in-ercot/

  6. “Governor Abbott Directs PUC and ERCOT to Shield Texans from Data Center Infrastructure Costs”, Office of the Texas Governor, June 10th, 2026, https://gov.texas.gov/news/post/governor-abbott-directs-puc-and-ercot-to-shield-texans-from-data-center-infrastructure-costs

  7. “Texas Pauses Data Center Interconnections Pending Statewide Audit”, Akin Gump Strauss Hauer & Feld LLP, August 7th, 2026, https://www.akingump.com/en/insights/alerts/texas-pauses-data-center-interconnections-pending-statewide-audit

  8. “The Explosion of Transmission Costs in ERCOT: Causes, Forecasts, and Policy Solutions” (Bennett and Piracci), Texas Public Policy Foundation, January 12th, 2026, https://www.texaspolicy.com/wp-content/uploads/2026/01/2026-01-LP-Transmission-Costs-BennettPiracci.pdf

  9. “Texas Data Center Boom Could Consume Up to 161 Billion Gallons of Water Annually by 2030,” citing Thirsty Data and the Lone Star State: The Impact of Data Center Growth on Texas’ Water Supply, Houston Advanced Research Center, January 21st, 2026, https://harcresearch.org/news/texas-data-center-boom-could-consume-up-to-161-billion-gallons-of-water-annually-by-2030/

  10. “Texas Lawmakers Question Billions in Tax Breaks for Data Centers”, Texas Public Radio, July 28th, 2026, https://www.tpr.org/economy-and-labor/2026-07-28/texas-lawmakers-question-billions-in-tax-breaks-for-data-centers

  11. “2026 Platform and Resolutions” (Planks 43 and 50), Republican Party of Texas, 2026, https://texasgop.org/wp-content/uploads/2026/07/2026-Republican-Party-of-Texas-Platform-As-Approved.pdf