Texas Freezes Data Center Approvals, Crypto Miners Feel the Pinch
Texas has introduced new regulations for data centers seeking to connect to its power grid. Governor Greg Abbott directed the Public Utility Commission of Texas (PUCT) and Electric Reliability Council of Texas (ERCOT) to verify and audit all new data center proposals before they can proceed further in the interconnection queue.
The goal is to 'keep the grid stable and reliable,' but the practical effect is a freeze on approvals that hits crypto miners particularly hard. The ERCOT interconnection queue currently holds over 474 GW of new load requests, with roughly 90% coming from data centers.
Data centers seeking grid connections must now provide detailed information across several categories, including state and local incentives received, expected water consumption, and plans for tracking community impacts. Projects that fail to meet compliance standards face denial of grid connection.
The new requirements effectively create a bottleneck for crypto mining operations in Texas, which have historically applied for tens of gigawatts in new capacity through ERCOT. The state's competitive energy prices, deregulated market, and innovative demand-response programs had made it an attractive location for Bitcoin mining.