Data Centers at Center Stage in Texas Senate Race

Democratic candidate for the U.S. Senate, James Talarico, intensified his criticism of Texas’s expanding data center industry during a CNN town hall. He contends that companies should handle the financial burdens tied to these projects rather than placing them on communities. His campaign aims to be the first Democratic win for the Senate in Texas since 1988. Polls indicate a competitive race in the traditionally Republican state.

Talarico frequently connects his Republican opponent, Texas Attorney General Ken Paxton, with data center development. He emphasizes potential backlash against Texans, highlighting increased electricity and water costs, while developers benefit. Texas and Virginia lead the country in data center growth, with nearly 700 facilities in Texas per Cleanview’s tracking.

“I was actually up in Abilene meeting with residents, Democrats and Republicans alike, because they are building three giant data centers,” Talarico stated at the town hall.

He has unveiled plans to restrain large data center companies. His proposals include mandates for companies to cover their energy costs, recycle water to alleviate local water crises, and obtain community approval before construction begins.

Ken Paxton supports the ongoing development of data centers but also recognizes the need for safeguards against strains on water resources and electricity costs. Newsweek reached out to both campaigns for comments via email.

Data centers have brought concerns related to their consumption of water and electricity, environmental impact, and proximity to residential zones. These issues are significant in the upcoming Senate race, which is pivotal for control of the chamber.

James Talarico’s Position

In July, Talarico called for stricter data center regulations. His proposals include setting minimum federal standards, removing Texas’s sales tax exemption for data centers, and requiring major energy consumers to support their infrastructure needs.

During a news conference, Talarico emphasized the necessity of ending favorable tax deals and holding data centers accountable for pollution. He also urged AI companies to bear the costs of their electric and water infrastructure.

Earlier, Talarico released a TV ad accusing Paxton of favoring data centers for personal gain, asserting that Paxton provided substantial tax breaks to data centers, receiving campaign contributions in return.

Ken Paxton’s Position

Paxton, meanwhile, advocates for data center growth, suggesting that Texas offers sufficient open space for construction distant from residential areas. During an interview with the U.S. Hispanic Business Council, he pointed out the potential for job creation and economic support.

He favors conditions that prevent data centers from burdening the electric grid and advocates for water recycling to avoid worsening water issues. Paxton’s campaign also announced measures to prevent the use of Chinese technology in data centers and proposed liabilities for data centers that encourage AI chatbots jeopardizing children’s safety.

A shift in some Republicans’ stance reflects local opposition. Mike Madrid, a Republican consultant, notes the change signifies a retreat from initial support.

Impact on Senate Race

Brandon Rottinghaus from the University of Houston believes Talarico might attract Republican-leaning voters, especially from rural and suburban areas. Concerns over water resources and electricity bills resonate among varied voter groups.

Cal Jillson of Southern Methodist University notes that the differences between Talarico and Paxton are not vast, although they express concerns differently. Both advocate for responsible handling of resources without compromising community welfare. Ultimately, policy is expected to strike a balance, accommodating data center growth with regulatory measures.

Polling Insights

Recent polls show a closely contested race. Talarico holds a narrow edge in several surveys. The RealClearPolitics polling average shows Talarico leading with a slight 2.6-point margin over Paxton.

A Marist poll reveals Talarico leading 47% to 45% among likely voters. A poll by ReconMR/Siena Research Institute also places Talarico ahead, reinforcing a competitive climate as the race progresses.