HD Intelligence Desk · September 28, 2026

Abbott Directs TCEQ to Halt Data Center Permits. Energization Stays Frozen

Published September 28, 2026

What Happened

On September 21, Governor Abbott wrote TCEQ Executive Director Kelly Keel and directed the agency to pause issuance of all permits related to data center projects until ERCOT completes its review. The letter says no other state agency shall move forward with regulatory approvals related to data centers until the PUC, ERCOT, and the Texas Water Development Board have that information, and it requires a TCEQ update by October 19. It says data center projects must cover electrical infrastructure costs, result in lower residential electric bills, complete the ERCOT and TWDB audits, not use water local communities need, report electricity and water use, and abide by setbacks, and that he will work with the Legislature to eliminate financial incentives for data centers. The same evening, Market Notice M-C092126-01 blocked an interconnecting TSP or DSP from seeing the other respondents' Batch Zero verification or community-impact RFI submissions in RIOO.

Why It Matters

The September 21 letter puts the same audit on the permit desk. Time-to-power (35%) was already gated on ERCOT's review of ≥75 MW computational load, and the letter ties TCEQ permits and other state regulatory approvals to that review. We hold ERCOT at A-. The August 17 notch priced the closed front door, the same shock is not cut twice, and trend stays down because the permit gate is written, the verification and community-impact clocks are still live, and energization is still frozen.

The rest of the board

SPP's ER26-3685 clarification of Conditional High Impact Large Load policy had comments due at 5 p.m. ET on September 23. The path is still open. We hold B+. MISO's ER26-3650 comments closed at 5 p.m. ET on September 18. The filing still requests a December 4 effective date. That remains process, not reserve margin. Hold C. PJM's September 10 answer in ER26-3380 still asks the Commission to accept Reliability Backstop Procurement by September 29 so the bid window can open September 30. Hold D; trend down on the calendar. On September 24 CAISO posted the Large Loads draft final proposal and draft tariff language. The draft tariff defines a Large Load as an end user at a single site whose point of interconnection is to the CAISO-controlled grid and that has a peak load of 50 MW or greater. It adds Flexible Interim Load Interconnection, curtailable service that lets a large load interconnect before its network upgrades are complete, and the proposal defers a permanent flexible product. Comments are due October 15. The Board of Governors date is still October 28. Hold C+.

Abbott Directs TCEQ to Halt Data Center Permits. Energization Stays Frozen

What Happened

Why It Matters

The rest of the board

Sources