Texas Governor Abbott has issued the harshest warning yet from a Republican to the AI industry, accusing data center companies of "digging their own graves" for failing to gain community support and deserving the current opposition. As local opposition turns into a political force, Abbott becomes the latest governor to shift course—previously he had actively lured such investments, and this reversal is not an isolated case: Pennsylvania Governor Shapiro implemented new restrictions this week, and New York Governor Hochul imposed a one-year moratorium on large-scale data centers last month.
From a $40 billion investment drive to audit hurdles
Just last November, Abbott announced a $4 billion investment plan with Google, including three campuses, calling Texas "the center of AI development"; in June, he instructed regulators to require data centers to fully cover the costs of power infrastructure and called for the cancellation of tax incentives. Earlier this month, he also ordered audits before connecting to the grid. Abbott said in an ABC interview that the backlash stems from construction proceeding too quickly and developers entering communities without local support; he also revealed that less than 10% of data center companies responded to the state's requests for information about electricity forecasts.
This wave of opposition is becoming a political challenge for the industry: The Republican Senate Committee has warned that voter anger could threaten the chance of retaining key seats in Ohio; Annenberg survey shows 61% of Americans oppose building new data centers locally (only 49% in March), and this is bipartisan—69% of Democrats, 54% of Republicans, and 53% of independents oppose it. Trump criticized Texas for saying "no," emphasizing that the industry's scale could surpass oil in the future.