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Texas moves to penalize data centers for water violations

By Thomson Reuters Sep 14, 2026 | 4:38 PM

By Laila Kearney

NEW YORK, Sept 14 (Reuters) – The governor of Texas, one of the world’s fastest-growing regions ​for artificial intelligence infrastructure, directed ‌state regulators on Monday to penalize data centers that fail to disclose details about their water consumption.

Texas, which halted the connection of ‌new ​data centers to the ⁠state electrical grid ⁠pending a review of the facilities’ power and water use, among other issues, is undergoing an overhaul of the ​way it regulates the server warehouses.

Governor Greg Abbott directed the Texas ⁠Water Development Board to “impose ⁠legal consequences” on data centers ​and other large water-consuming entities to comply ​with water use reporting requirements.

“Major water ‌users, including data centers, appear to have committed civil and criminal violations through failure to provide TWDB with ⁠required information about water usage,” Abbott’s office said in a statement.

The Texas water regulator is ⁠attempting to ‌survey data centers about ⁠their water use and expected ​consumption. ‌If the data center fails ​to return ⁠the survey by the deadline, it will be denied new or renewed environmental permitting needed for the facilities.

(Reporting by Laila Kearney in New York, Editing by ​Franklin Paul)