Utility Commission Weighs Three Data-Center Power Deals Under a New State Law

The Public Utility Commission of Texas meets Oct. 15 on three applications to wire very large electricity customers straight into a single power plant, so that the plant’s output is netted against what the customer draws. A law passed last year gave the commission the final say over those arrangements, and it has decided only one so far.

Under a provision of the 2025 grid bill, a generator must notify ERCOT — the nonprofit that runs the power grid for most of Texas — before it starts netting a new large customer against its own output. ERCOT then has 120 days, from the point it has all the information it needs, to study what the pairing does to the grid; the commission has 60 days after that to approve it, deny it, or attach conditions to protect reliability. If the commission lets the clock run out, the statute says it is considered to have approved the arrangement.

The commission used that authority for the first time in July, in a case pairing a wind facility with a computing load. It required the customer to disconnect entirely when ERCOT says a transmission emergency demands it, barred the operator from selling demand reductions back into the market as a product, and ordered the parties back before the commission in three to five years to revisit those terms. Three more now follow: a West Texas solar project paired with a data-center company, an application from the operator of the Comanche Peak nuclear plant, and a Haskell County wind farm paired with a data-center owner. How much power any of the three would move, and who stands behind the two data-center entities, could not be established from filings the Dispatch could reach.

The rest of the agenda runs long and mostly quiet. The commissioners take up a rule letting utilities contract for battery storage instead of building poles and wires, capped statewide at 100 megawatts, which implements a law the Legislature passed in 2021; a housekeeping rewrite of the rule certifying retail electricity sellers; and a rate case for a transmission-only utility that owns 330 miles of line built under the state’s wind-power buildout. Two Oncor applications for 765-kilovolt lines out of the Permian Basin, approved in August, return only so the commission can buy itself more time to rule on requests for rehearing.

Watch the conditions rather than the votes. The July order showed the commission will trade approval for curtailment promises, and whether it holds that line across three more deals sets the price of co-locating a data center in Texas.

Meeting at a glance

Commissioners

• Thomas J. Gleeson — chairman; Pflugerville; term ends September 2029.
• Kathleen Jackson — Beaumont; professional engineer; term ends September 2027.
• Courtney K. Hjaltman — Austin; term listed as expired September 2025.
• Morgan J. Johnson — Austin; appointed October 2025; term ends September 2031.
• Patrick J. Rhode — Austin; appointed March 2026; term ends September 2027.

Names are from the governor’s appointment releases and the Texas Register’s record of appointments, checked October 8. The commission’s own commissioners page lists only three of the five and shows neither Johnson nor Rhode; it was not relied on. No reappointment of Hjaltman after her term expired September 1, 2025 was found in the governor’s releases or the Texas Register. Texas officers commonly hold over until a successor qualifies, but her status was not confirmed here. Johnson and Rhode were both appointed after the Senate last sat, so neither has been confirmed; both appointments are subject to confirmation whenever it next convenes.