AUSTIN, Texas — Texas lawmakers say they need more information from technology companies operating data centers before they can effectively regulate the industry’s rapid expansion and its impact on Texas’ water supply and electrical grid.
The concerns emerged during a nearly 10-hour hearing Wednesday before the Texas House Natural Resources Committee, where lawmakers examined how increasing demand from data centers could affect natural resources, energy infrastructure and local communities ahead of the next legislative session.
Lawmakers questioned whether companies are providing enough information about electricity consumption and water use as Texas continues to attract large-scale technology investments.
State officials told the committee that only about 17% of data centers required to complete a state water-use survey have submitted information.
Lawmakers said the low participation rate leaves agencies without reliable data to forecast future water and energy needs and complicates long-term planning.
The discussion also highlighted concerns from local leaders dealing with rapid development.
In Navarro County, west of Tyler, county officials say multiple data center projects are moving forward with little notice to local government and limited authority to manage their impact.
Commissioner Jason Grant, who represents Precinct 1 in Navarro County, said local leaders are struggling to keep pace with development.
“We’ve got projects being discussed and moving forward that counties may not even know are coming until much later in the process,” Grant said. “There’s concern because counties don’t necessarily have the tools to stop them or fully understand the impact they could have on infrastructure and resources.”
Lawmakers said those concerns reinforce the need for better industry participation and transparency before new regulations are considered.
The issue is expected to remain a major topic heading into the 2027 legislative session as lawmakers weigh how to balance economic development with protecting Texas’ limited water resources and maintaining electric grid reliability.
State leaders said additional hearings on water policy and natural resource planning are expected before lawmakers return to Austin next year.
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