US Midterms Prompt AI Data Center Controls: ~13 GW of Texas Projects Face Delays

Following the US midterm elections, newly elected governors in Texas, Ohio, and Georgia campaigned on stricter oversight or moratoriums on AI data centers. Texas Governor-elect Gina Hinojosa called for halting approvals until state legislation enacts safeguards, while outgoing Governor Greg Abbott had already paused permits pending audits by ERCOT and water authorities. Wells Fargo estimates Texas holds 27% of planned US data center capacity. GLJ Research and Jefferies estimate 13 to 13.3 GW of capacity could face delays, with unpermitted projects potentially pushed back 12 to 18 months. While Taiwanese ODMs including Foxconn, Inventec, Wistron, and Pegatron assemble servers in Texas, policy restrictions apply to infrastructure permitting rather than server production, leaving supply chain impacts uncertain.

Key takeaways

• Governors-elect in Texas, Ohio, and Georgia proposed moratoriums or conditions on AI data center approvals over utility costs and resource usage.
• Analysts project 13 to 13.3 GW of Texas capacity could face delays; projects lacking state environmental permits may be deferred by 12 to 18 months.
• OpenAI plans community compacts and proposed state legislation to address local backlash, while analysts expect higher compliance costs over outright bans.
• Taiwanese server assemblers with Texas facilities face uncertain order impacts, as restrictions focus on data center construction permits rather than hardware manufacturing.