Texas Governor Greg Abbott Orders Penalties for Datacenters Violating Water Use Disclosure Laws

Greg Abbott, the Texas governor, has directed state regulators to penalize datacenters that fail to comply with state laws requiring them to disclose their water use.

“Data centers must share the duty to protect Texas water,” the Republican governor said on Monday. “The Texas Water Code requires a complete and accurate water use survey. I direct the Texas Water Development Board to use its enforcement authority to penalize past failures and to impose legal consequences for any future failure to comply,” he added.

In a letter to the water board, Abbott, who is seeking a fourth term, said: “Major water users, including data centers, appear to have committed civil and criminal violations by failing to provide the Texas Water Development Board (TWDB) with information about water usage as required by the Texas Water Code.”

It follows a directive Abbott issued last month ordering the Public Utility Commission of Texas and the Electric Reliability Council of Texas (Ercot) to conduct a comprehensive audit of datacenters advancing through the Ercot interconnection process.

Drought-prone Texas has fast become the heart of the US’s datacenter boom.

Texas has the second-most datacenters of any state in the country, according to a tally by the Pew Research Center. But with 335 datacenters, and at least 248 more in the pipeline, experts believe it could surpass Virginia as the world’s largest concentration of datacenters by the end of the decade.

But, amid growing public concern over datacenter construction, Texas has been working to tighten oversight of the industry as demand grows for the state’s power and water supplies.

In 2025, Texas datacenters consumed an estimated 25bn gallons of water, according to the Houston Advanced Research Center. Water use by datacenters in the state could rise to 161bn gallons a year by 2030 – about 2.7% of all water used in Texas, or roughly the amount consumed by 1.3m households across the country.

The audit requires datacenters to provide information about their water consumption, water sources and efforts to use water-efficient technologies. Abbott said projects that fail to complete the audit will be denied permission to connect to the state’s power grid.

“TWDB’s water use surveys serve a similarly important purpose as this data center audit. TWDB must coordinate with PUC and ERCOT to ensure that covered entities provide critical water use information in response,” Abbott said in his Monday letter. “Any failure to respond to the audit’s request for water use information would trigger TWDB’s independent enforcement authority.”