Opposition to data centres is spreading across Texas, where voters’ concerns about power bills, water use and public subsidies are becoming a political problem ahead of the midterm elections. The dispute matters to AI because the state’s fast-growing data-centre buildout is tied to demand for AI computing.
Watch Desk analysis
What happened
The Verge reports that Texas communities are pushing back against new projects, with a coalition called We the People Texas bringing together groups including the state NAACP. Its co-founder estimates the coalition represents as many as one million voters. An August poll cited in the report found that 57% of Texans oppose data-centre construction, including 43% of Republicans, 75% of Democrats and 54% of independents.
The report describes local fights in Taylor and Temple, and says San Marcos became the first Texas city to ban data centres. The political argument has a material backdrop: Texas’s tax exemption for qualifying data centres was estimated by state officials to cost $3.2 billion in lost sales-tax revenue over two years. Average electricity bills rose 35.4% over five years, while a research centre estimates data centres used about 25 billion gallons of water in Texas last year.
Why it matters
Texas has welcomed data-centre development, but the costs and consequences are now harder for elected officials to keep at arm’s length. The report says Governor Greg Abbott has called for operators to cover new infrastructure costs and announced permit moratoriums pending audits of electricity and water use. Critics argue those steps do not reach every project, particularly facilities building their own power supply.
For AI companies, reliable computing capacity depends on more than chips and investment. It also depends on whether communities accept the energy, water use and infrastructure needed to run large data centres. That social licence is looking rather less automatic than the industry might have hoped.
Our read
This is a consequential AI-infrastructure story because the argument is moving from planning meetings into electoral politics. The poll and coalition figures suggest the opposition crosses party lines, but they do not settle what voters will do at the ballot box. The practical test is whether candidates offer enforceable rules on costs and resource use, rather than a fresh round of reassuring language.
What to watch
- Whether candidates make data-centre costs and permitting a prominent campaign issue.
- Whether Texas’s proposed audits and infrastructure-cost rules apply to projects with their own power supplies.
- Whether the state changes its tax incentives or water and electricity oversight.
Discussion spark: Should Texas keep offering tax breaks to attract data centres if local communities bear more of the costs in power, water and infrastructure?
Sources and evidence
- Source update (28 October 2026, 12:00 UTC)
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