That is according to panellists speaking at a Datacloud USA keynote session on Texas data centre development.
Meghan Griffiths, co-chair of the data centre group at law firm Jackson Walker, who chaired the panel, told delegates that ERCOT’s initial “batch zero” study, now subject to a state-ordered audit, estimates around 205GW of that demand as credible. She put ERCOT’s current peak demand at around 91GW, meaning the batch zero estimate alone would represent a 125% increase if realised in full.
Texas Governor Greg Abbott ordered the audit in a letter to the Public Utility Commission of Texas (PUCT) and ERCOT on 3 August, directing a “comprehensive verification and audit” of data centre projects advancing through the interconnection process before any further projects are approved, with non-compliant projects to be denied grid connection. ERCOT has since paused planned batch zero classification notifications. The audit’s scope has since narrowed to between 250 and 300 projects representing around 200GW of demand, rather than the full queue, PUCT officials confirmed at a subsequent emergency meeting.
The panel also included Texas State Senator Paul Bettencourt, Venkat Tirupati, vice president and chief technology officer at ERCOT, Alex Hernandez, founder and chief executive of PowerBridge, and Santiago Suinaga, senior vice president of cloud and hyperscale at Stream Data Centers.
Bettencourt described 2026 as “the frothiest political year” of his career, pointing to rising local opposition tied to concerns over power use, water consumption and land. He said Texas is home to 335 data centres supporting around 100,000 direct jobs and 400,000 indirect jobs, generating an estimated $65bn in annual economic activity, but argued the industry has failed to communicate its resource use and footprint effectively to the public.
He said the state’s sales tax exemption for data centres, introduced around 2013 to 2015 at an estimated annual cost of $14.7m, now costs an estimated $3.3bn to $3.4bn a year, and suggested electricity-related subsidies specifically are likely to be scaled back or removed in the next legislative session. Senate Bill 6, signed into law in 2025, already requires large loads of 75MW or more to disclose usage and comply with curtailment obligations during grid stress events.
Hernandez said PowerBridge, which he founded in 2025 after selling his previous venture, Cumulus Data, to Amazon Web Services in 2024, believes West Texas will become the largest data centre market in the world. He said Pennsylvania’s data centre capacity had grown from zero in 2020, when Cumulus began developing its Susquehanna nuclear-adjacent campus, to around 7.5GW today, and argued Texas is likely to follow a faster and larger growth trajectory. He said PowerBridge’s model is to build more power generation than the load its campuses consume, with surplus capacity available for export via transmission to other parts of the state.
Suinaga said Stream Data Centers, which has operated in Texas for 27 years, remains “very bullish” on the state regardless of the audit’s outcome, arguing that legitimate developers should benefit once speculative projects are removed from the interconnection queue. He also said the industry had operated with a low public profile for years and now needs to do more to control the narrative around its impact.
Tirupati said ERCOT is embedding AI across its own operations, including efforts to accelerate its interconnection study processes, with more than 800 of its roughly 1,000 employees now active users of AI tools internally.
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