Texas’ rapid data center expansion is colliding with another major concern for the state: water.
Attorney General Ken Paxton announced Thursday that his office is investigating hundreds of data center developments over whether they have complied with state water-use reporting requirements. The investigation focuses on developments that have not responded to the Texas Water Development Board’s annual Water Use Survey.
The investigation does not, by itself, establish that the developments have violated the law. But it raises a reasonable question as Texas welcomes billions of dollars in technology investment: Does the state have enough reliable information to understand how much water these projects are using and may need in the future?
That is a question Texas officials increasingly appear determined to answer.
Abbott pushes enforcement of reporting rules
Paxton’s investigation follows a Sept. 14 directive from Gov. Greg Abbott ordering the Texas Water Development Board to enforce existing reporting requirements against major water users, including data centers.
Abbott said the state needs complete information to plan for future water demand.
“Data centers must share the duty to protect Texas water,” Abbott said.
His directive calls for consequences when data centers fail to comply, including referrals to county or district attorneys and notification to the Texas Commission on Environmental Quality when noncompliance could affect eligibility for certain water permits. Abbott gave the water board until Oct. 14 to provide an update on its enforcement efforts.
The governor went further this week, directing TCEQ to halt permits sought by data centers until an audit involving the Electric Reliability Council of Texas is completed.
Those actions signal a significant change in how aggressively Texas officials are approaching the industry's resource demands.
Why the water reports matter
The Water Use Survey is not a new requirement created specifically for data centers.
Texas law requires recipients of the survey to complete it, and TWDB uses the information for regional and statewide water planning. Industrial surveys cover manufacturing, mining, steam-electric power and data centers. TWDB says it surveys roughly 8,000 water systems and industrial facilities each year.
The information has practical consequences. State water planners are trying to estimate how much water communities and industries will require years and decades from now. Those projections become harder when a rapidly expanding industry does not provide complete information.
TWDB has also been working to better identify data center consumption. Beginning with the survey covering 2024 water use, the agency said it would attempt to track data center use more explicitly within its manufacturing category.
That makes accurate reporting especially important as the industry grows.
Paxton investigation reaches the Panhandle
The attorney general’s investigation is not confined to the state's largest metropolitan areas.
The initial list covers developments in Harris, Montgomery, Travis, Dallas, Tarrant, Smith, Bexar, Tom Green, Potter, Randall, Lubbock, Midland, Ector, Wichita, Victoria, Brazos, Nueces and El Paso counties. That puts Amarillo-area developments in Potter and Randall counties within the investigation's reach.
“My office is currently investigating hundreds of data center developments to ensure that they are transparent about their water usage and fully compliant with the law,” Paxton said.
What remains unclear from Thursday's announcement is how many facilities in each county are being investigated, how long individual developments have gone without responding or whether some cases could involve incomplete records rather than outright refusals to report.
Those distinctions will matter as the investigation progresses.
Transparency should come before conclusions
Data centers can bring investment, construction activity and jobs to Texas communities. They also require infrastructure and resources, including electricity and, depending on their cooling systems and operations, water.
Those competing considerations make reliable numbers more valuable than assumptions.
The reporting requirement provides the state with a straightforward way to establish part of that factual foundation. Facilities receiving the survey are required to respond, and failure to do so can carry consequences including loss of eligibility for certain state financial assistance and water permits. Failure to complete and return the survey can also constitute a Class C misdemeanor.
TWDB says the regular survey period begins in January and is generally due March 1. Although its online application closed July 1 for 2026, entities with past-due surveys can still submit printable forms.
Paxton's investigation could ultimately reveal serious noncompliance, administrative problems or some combination of the two. Until more information is released, it would be premature to assume what investigators will find.
