Texas governor-elect Gina Hinojosa said on 5 November that data centre development should stop until the state has laws protecting residents, particularly in rural communities, USA Today reported. Speaking to CNN after her election, Hinojosa said Texans should be able to decide whether and how projects enter their communities. Her proposed pause would make resident protections a condition for further development.
Key points
- Hinojosa says Texas should stop data centre development until laws protect residents.
- She wants communities to decide if and how data centres are built locally.
- Wells Fargo puts 27% of planned US data centre gigawatts in Texas.
- Hinojosa’s position follows a campaign call for an immediate moratorium and an earlier statewide moratorium enacted by Governor Greg Abbott.
Hinojosa wants Texans at the table
Hinojosa defeated Republican incumbent Greg Abbott in the 3 November election after campaigning for an immediate moratorium on data centre construction. Her remarks on 5 November tied a halt to a further condition: laws protecting people where the facilities are built. She told CNN that data centres had entered mostly rural communities without rules to protect Texans, whom she said were being taken advantage of.
Hinojosa said she wants residents to “have a seat at the table to decide if and how these data centers come into their communities”. She also said she is not opposed to data centres as a rule. Her objection, she said, is to “the way they are taking advantage of Texas”. Those remarks put the terms of a project’s arrival in a community, as well as the protections governing it, at the centre of her position.
Abbott had previously described Texas as the “epicenter of AI development” before enacting a statewide moratorium on data centre construction. The election therefore did not introduce the idea of a halt to construction into Texas politics. Hinojosa’s 5 November account of what should happen next centres on protective laws and a role for residents in deciding whether projects proceed.
Hinojosa also addressed the place of Elon Musk’s companies in the state. She said Texas could have a “strong working relationship” with them, but that it would have to be on the state’s terms. Her comments came after Musk had spent money backing Republicans in Texas, where his companies Tesla and SpaceX are based. AI Affairs previously reported that the Texas election had brought data centre expansion under closer scrutiny.
Texas holds 27% of planned US capacity
The prospective reach of a Texas pause is substantial. Wells Fargo puts 27% of planned US data centre gigawatts in the state, CNBC reported on 4 November. The bank’s figure concerns planned capacity, rather than facilities already operating. After Hinojosa’s election victory, investors weighed whether state-level data centre restrictions could delay projects.
More than 80 data centres are operating in Texas, with another 50 under construction and more than 120 planned, according to data centre tracking group Cleanview’s figures reported by USA Today. Those categories place projects at different stages of development. Hinojosa’s call to stop what the state is doing with data centres until protections are in place addresses development, while her stated aim of giving communities a choice concerns where projects can go.
Shares of several companies linked to AI infrastructure fell on 4 November as the election results came in. CNBC reported that SpaceX shares were down 4% after the open and Tesla shares were down 5%; CoreWeave and Iren also fell by 4% in morning trading. SpaceX is building multiple gigawatts of data centre capacity, including projects in Texas. Musk posted that “data centers in space” were looking appealing after the result, referring to his proposed orbital infrastructure.
The concern extends beyond one company’s projects. Dan Ives, a partner at Yorkville Ives & Co., predicted in a 4 November note that the midterm results would slow data centre construction across the US. Wells Fargo estimates that Georgia has 7% of planned US data centre gigawatts, while Ohio and Pennsylvania each have 5%. Democrats also won or retained governorships in those three states.
Data centre restrictions reach November ballots
Democrats also won majorities in the US Senate and House of Representatives in the 3 November midterms. In Texas, Hinojosa’s victory followed a campaign in which she made data centre construction a prominent issue. The governor-elect’s 5 November remarks moved from that election pledge to the terms on which she says development should resume: protections for Texans and a say for the communities receiving projects.
Voters elsewhere considered restrictions directly. Roughly 40 US cities and towns weighed measures affecting data centre development, and at least 33 voted for restrictions, according to Data Centers on the Ballot, a tracker cited by USA Today. The measures included moratoriums, new regulations and bans. The tracker recorded one town in North Dakota voting against restrictions.
In NBC News exit polls, 56% of voters called AI and data centres a crucial or major factor in their vote for Congress. About 76% said they would oppose construction of new data centres in their own communities.
