As Texas Gov. Greg Abbott sees it, the state is primed for a massive influx of data center and AI-related investments unlike any so far.
Abbott said diversifying the state economy with nontraditional industries was paramount, the Austin Business Journal reported. Abbott’s remarks, at a Texas Economic Development investor summit this week, came amid Oracle’s plans with OpenAI and SoftBank to invest $400 billion over the next three years to open AI data centers across the country, in a joint venture dubbed “Project Stargate.”
The first Stargate campus opened in Abilene earlier this year.
Abbott teased to-be-announced AI-related investments coming soon to Texas, which he claimed could be bigger than Stargate.
Five more Stargate centers are on tap, including locations in Shackleford County and Milam County in Texas, as well as Lordstown, Ohio and Doña Ana County, New Mexico. Another is planned for the midwest.
Seven gigawatts of capacity for AI-related data processing will be reached once all five are completed, along with 25,000 onsite jobs and thousands of ancillary positions across the country.
The data center in Abilene is projected to consume 6 GW, nearly double the daily usage of the Texas Rio Grande Valley, for example.
Plentiful land and infrastructure has made Texas a hub for data centers, according to CBRE. The Dallas-Fort Worth metro has about one-tenth of the U.S. data center market, the largest share after Northern Virginia. But power capacity is a chief concern. Abbott said the state produces more electricity than any other, generating 12 percent of the nation’s total.
IData Center equating to more than a gigawatt of capacity are under construction in Dallas-Fort Worth, said Curt Holcomb, managing director for data center solutions at JLL. Holcomb estimated another four gigawatts are in planning stages.
How that fares against the increased need for water and electricity created by these data centers remains to be seen, with data computing expected to increase electricity demand by 7 percent this year and 15 percent in 2026 according to the U.S. Energy Information Administration.
Some developers are proposing electricity production along with the whole data center package. Fermi Inc., the real estate investment trust co-founded by former Texas Gov. Rick Perry, is pitching “Project Matador” on land owned by Texas Tech University, a 5,000-acre advanced energy and intelligence campus aiming to attract data center and hyperscaler tenants, with plans for 11 gigawatts of power by 2038 from natural gas, solar, and nuclear sources.
— Eric Weilbacher
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