Texas Gov. Greg Abbott last week directed the Texas Commission for Environmental Quality (TCEQ) to stop issuing air permits for data centers.
The move looked to be the first sweeping crackdown on the controversial computing facilities after a succession of purported crackdowns from Abbott’s office that left plenty of wiggle room for the industry.
“Simply put, Texas must come first,” the Republican governor’s Sept. 21 order states. “Data centers must pay their own way, protect our grid and water, and complete the [Electric Reliability Council of Texas] and [Texas Water Development Board] audits. Until they do, TCEQ will issue no permits sought by data center projects.”
However, some Democrats see the move as more political theater from Abbott, given that the governor has already accepted $20 million in contributions from the industry, according to campaign finance records.
“Anyone that believes Abbott has had a change of heart is ignoring the fact that Abbott has already taken the data center money,” Clayton Tucker, the Democratic candidate for Texas Agriculture Commissioner, said in the caption of an Instagram post about the order. “He could have done this MONTHS ago not 42 days before the election…”
Indeed, months ago, Abbott was singing a different tune.
Last November, the governor touted Texas as the “epicenter of AI,” welcoming the industry with open arms and lax regulations. Texas now has 349 operational data centers, 101 under construction and another 156 planned, according to online tracking site US Data Center Map.
Bexar County has the third-highest number of data centers of any Texas county, at 33 operational and 13 in the pipeline. The facilities have a total reported electrical demand of 2 gigawatts — enough to power every home in the county.
However, many other data centers in the state are popping up in rural areas, places that have long been hotbeds of Republican support.
Now, seemingly responding to pressure from his own base during a tough election season, Abbott has made the first real, tangible move to curtail the industry’s encroachment on the state, according to critics.
Still, it’s unclear how many data centers his latest directive will actually put on pause. Projects that may feel the impact include a massive Amazon hyperscaler in the Panhandle called Horizon Junction, which filed for TCEQ permits in August.
Can he do that?
Environmental activists the Current spoke to welcome any progress at all on the issue from Abbott, even if motivated by cynical political calculus.
But some question whether Abbott or the TCEQ are even legally capable of pausing the permitting process.
“TCEQ has said before they don’t have the authority to halt all permits for a given industry,” said Adrian Shelley, director of Public Citizen’s Texas office.
In April 2024, Lt. Gov. Dan Partrick asked the state to halt new permits for cement kilns in response to fierce public opposition to a proposed 600-acre permanent kiln and limestone quarry Black Mountain Cement wanted to develop near the town of Dorchester.
“I ask you to immediately pause the permitting processes for all permanent cement production plants statewide until the legislature can weigh in,” Patrick wrote in the letter to the TCEQ.
However, then-TCEQ Chairman Jon Niermann responded with a letter saying the commission doesn’t have the authority to halt all permits for an entire industry, according to Shelley.
“I tried to find that letter from Niermann to Patrick, but it seems to have been scoured from the Internet,” Shelley said.
The Current submitted a Freedom of Information Request with the TCEQ to obtain the response letter from Niermann to Abbott, but the agency is still processing that request.
If the TCEQ doesn’t challenge Abbott’s directive, it would be a break from precedent for the agency — and done without apparent legal backing.
“I think the things that [Abbott] has said that could potentially have the greatest impact really do require legislative approval,” said Luke Metzger, executive director of advocacy group Environment Texas. “And I think the question remains to be seen: how much is he going to put his shoulder behind those proposals?”
The fact remains that the governor — and only the governor — has the authority to call a special session of the Texas Legislature to create the backing from lawmakers needed for such a directive, environmentalists argue.
So far, the TCEQ has indicated that it plans to uphold the governor’s directive, regardless of whether it’s legally supportable. Bastrop activists fighting the nearby 2,842-acre Pacifico data center campus emailed the TCEQ for such assurance last week, according to emails obtained by the Current.
Silicon Valley AI company Anthropic is in talks to lease the proposed $2.2 billion hyperscale data center campus, which is paired with a 710-megawatt gas-fired power plant, according to the Austin Business Journal.
Samuel Short, director of the TCEQ’s Air Permits division, not only assured activists that the Pacifico project was on hold that but his agency plans to uphold Abbott’s directive.
“At the direction of Governor Greg Abbott, the Texas Commission on Environmental Quality (TCEQ) has paused the issuance of all air and water permits and authorizations related to the construction or development of infrastructure directly supporting data centers while ERCOT completes its comprehensive grid and community impact audit,” Short said in the email.
“The agency will ensure its regulatory evaluations incorporate findings from ERCOT’s review and will provide a full update on compliance to the Governor’s Office by October 19, 2026,” Short added in the correspondence.
Even if there isn’t a legal precedent for the TCEQ to uphold the directive, Metzger said data center companies may just want to “keep their heads down” and comply with the temporary pause rather than legally challenging the governor, who could soon make all their dreams of Texas expansion come true.
Temporary pause vs. permanent reform
Environmental experts told the Current that pausing the issuance of air permits isn’t enough. The permitting process itself must be reformed.
“Many companies are using the minor source permit process where they can basically stage the development of their data center, and then each stage can come just under the threshold that would require them to get a major source air permit,” Metzger said. “Which would mean far more public engagement in the public hearings and comment period, as well as potentially tougher pollution controls.”
Additionally, Metzger argued that reforming the permitting process through the passage of legislation is a permanent solution, while the pause is only temporary. Many critics have accused Abbott of only being interested in pausing data center development until the midterm elections are in the rearview mirror.
According to Abbott’s announcement, the pause on permits is meant to last until ERCOT and TWDB complete their separate audits of data centers, both of which are expected to conclude sometime in December.
“And so basically, this potentially could all come to an end right after the election,” said Metzger. “I think a lot of people are worried that despite all his protestations about data centers as of late, that we could see a change of tune post-election.”
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