Texas Data Centers Are Growing Fast. Lets Make Sure They Build Up Texas.

Ryan Pollock, Executive Director of the Texas Building Trades Council
Monday May 18, 2026

Data center development is increasingly part of Texas's economic and energy future, and is necessary to support cloud computing, streaming, and responsible artificial intelligence. If you've noticed massive new facilities going up across Central Texas and around the state, you're seeing the leading edge of a national buildout that represents billions of dollars in private investment, thousands of union construction jobs, and long-term opportunities for Texas workers across the building trades, electrical sector, and energy infrastructure workforce.

The numbers are real. According to a report by the Texas Economic Development Corporation, by the second quarter of 2024 data centers had supported 485,000 jobs across Texas, including nearly 50,000 direct jobs. In the same year, these facilities generated roughly $1.6 billion in state taxes and another $1.6 billion in local taxes. Over the next several years, Texas projects the industry will deliver $3.8 billion in additional state revenue and nearly $5 billion in new revenue for schools and local governments.

That's a meaningful opportunity. The Texas Building Trades Council represents the men and women who will build these facilities, and we want this work. We want Texans doing it and we want it done under standards that match the scale, complexity, and public investment involved.

Our job now is to make sure these developments are held to standards that benefit workers and communities for the long run. When public dollars and public infrastructure are on the table, the public deserves enforceable commitments in return: good construction jobs, transparent deals, and communities that benefit long after the ribbon-cutting.

AI is a policy question. Data centers are a construction question.

A lot of the opposition to data centers isn't really about the buildings. It's about what gets done inside them. There is real anxiety about artificial intelligence— what it will do to jobs, to workplace decisions, to the information environment. That anxiety is legitimate and the Building Trades share it, but blocking a warehouse full of computers in Texas towns doesn't slow AI down. It just sends the construction work, the tax revenue, and the public's leverage o demand accountable practices somewhere else, usually somewhere with fewer protections for workers and communities.

If we have concerns about AI as a technology, the right venue is policy. The AFL-CIO has already done that work, and the polling backs it up. 95 percent of Americans support requiring a human to be the final decision maker on issues affecting a worker's employment. There is similarly strong support for guaranteed access to training and educational programs, guardrails against harmful workplace uses of AI, and rules preventing AI from being used to spread misinformation. Those are the right fights, in the right venues. Site-by-site data center moratoria conflate two different problems, burn political capital that should be aimed at AI policy, and cede infrastructure decisions to whoever pushes back least. We can do better than that, and the standards laid out below are how.

Understanding our leverage

Texas is attracting data centers because we have available land, strong logistics, major connectivity, and the capacity to build at scale. That's exactly why public giveaways shouldn't be treated as automatic. If the argument is "they are coming because Texas works," then it follows that Texans have negotiating power. We should use it.

We're already seeing what that negotiating power looks like in practice. Communities across Texas, particularly in rural areas, are organizing against data center projects in places we have never seen organized before. They have real power when they do, and that power is worth respecting, but the hard truth is this that when a community successfully blocks a project, the data center doesn't disappear. The buyers for that capacity still exist and the project moves to a community with less leverage and gets rolled. The same organizing strength that can shut a project down can also be used to demand strong terms like local hiring, infrastructure commitments, cost-causer pays protections, real community benefits. That's a more strategic use of the leverage, and it produces a better outcome for the people who live nearby, the workers who build the project, and Texas as a whole.

Incentives should be treated like any serious investment decision— if public dollars are involved, what exactly is the public purchasing, what commitments are enforceable, and how do we verify performance? Strong construction opportunities and good deals for taxpayers aren't mutually exclusive. They just require transparency and accountability from the start.

That's the frame for what follows. We see three standards every major data center project in Texas should meet.

Standard 1: Pro-worker

Data centers should create good jobs at every stage of construction, maintenance, and operations. That means:

• Project Labor Agreements (PLAs) that lock in fair wages, safe working conditions, and local hiring before the first shovel hits the ground.
• Prevailing and living wages on every job, with responsible bidder requirements that prioritize worker-first contractors and screen out the race to the bottom.
• Serious investment in Department of Labor Registered Apprenticeship Programs (RAPs) to expand the pipeline of skilled electricians, pipefitters, and other crafts Texas needs.
• Local hiring commitments so Texas workers capture Texas opportunity.
• U.S.-made, union-built supply chains: materials manufactured, secured, and maintained domestically with union labor.
• Union jobs across the lifecycle, from construction through ongoing operations and maintenance.

It's worth addressing two complaints we hear about data center jobs. The first is that "most of these are just temporary construction jobs." For the men and women of the building trades, that work is our livelihood. Every construction job is technically temporary, but our members move from project to project and stay employed because the work keeps coming. Calling these jobs "just temporary" misunderstands how the construction industry functions, and it sells short the skilled workers who actually build Texas.

The second complaint is that traveling workers brought in for these projects displace locals and drive up housing costs in small communities. That concern is legitimate, and it is exactly why local hiring requirements are not a nice-to-have, they're essential. When projects commit to hiring Texans first, the construction work strengthens the host community instead of straining it. Local trades workers capture the paychecks, the housing market doesn't get distorted by short-term demand, and the host community benefits both during construction and after the facility opens.

This isn't an add-on. Texas faces a skilled trades shortage that already threatens every major sector. Electricians and pipefitters are stretched thin across grid buildout, industrial expansions, and infrastructure projects statewide. Without workforce development commitments, data centers compete with every other major project for the same limited pool of workers, driving up costs, delaying schedules, and squeezing the entire pipeline. Apprenticeship investment is how Texas builds the capacity to sustain this growth.

Standard 2: Accountable

Data centers should be accountable for how they use Texas resources and how they affect Texas communities. That means:

• Early engagement with transparent pre-approval and post-approval processes, including public meetings where residents can ask hard questions before the deal is locked.
• Enforceable commitments from companies, with verification and clawbacks when promises aren't kept.
• Proper consideration for water systems, air quality, noise, and local infrastructure.
• Sustainable cooling and water use: air cooling, closed-loop systems, and recycled water where possible.
• Renewable and sustainable energy sources to power these facilities.
• Support for the build-out of electricity generation and grid infrastructure the projects require.
• Honest review of disparate impacts in site selection, so the costs don't keep landing on the same communities.
• Transparency and reporting about the value and duration of incentives, the specific jobs being created, and what infrastructure the developer is funding versus what the public is covering.

Early engagement matters because once incentives are granted, zoning is locked, and utilities make major allocations, the public's leverage collapses. Those conversations happen either early, when they're manageable, or late, when they turn into lawsuits, delays, and cost overruns. Early is better for everyone as it means owners get certainty, workers get clear schedules, and communities avoid surprises that tank public support.

What happens when transparency breaks down

In Taylor, a data center was approved on 87 acres that were deed-restricted for parkland. Instead of a park, the neighborhood got a windowless industrial facility roughly 500 feet from their homes. No public access. No local jobs. No community benefit.

That is what happens when communities lack leverage and developers face no requirement to negotiate terms early. With the right standards in place from the start, it's avoidable.

Standard 3: Affordability

Texas is in an affordability crisis. Done right, data centers can be part of the solution and actively contributing to lower utility bills, a stronger grid, and bigger school budgets. The standards we should hold every project to:

• Cost-causer pays. If a developer needs new transmission, generation, or water infrastructure to serve their project, the developer pays for it, not the residential ratepayers and small businesses who didn't ask for the development. This is the cleanest version of cost-shifting protection: not a complicated rate calculation, but a basic principle that the customer requiring the upgrade funds the upgrade.
• Ratepayer-positive deal structure. Projects should be approved on terms that lower other customers' bills, not raise them. Whether bills go up or down depends entirely on how the deal is structured, and Texas should structure for net savings.
• Significant contributions to new tax revenue that strengthen local school districts and government services, easing the property tax burden on homeowners and small businesses.
• Investment in clean energy and grid infrastructure at a scale ratepayers could not fund alone, including renewable generation, long-duration storage, and the transmission required to deliver it.
• Requirements that on-site generation feed excess power back into the grid when not needed by the facility, so the project adds to capacity rather than just drawing from it.

Modern data centers also deliver real, permanent jobs such technicians, electricians, facilities, and operations roles that pay well. Numbers vary by project. A small site might add 10 to 20 permanent positions, while a larger one can add well over 100. In the rural Texas counties where many of these are being sited, that is a major economic event and the kind of opportunity that has been missing from those communities for a long time.

Texas is not the first state working through how to make this pencil out. Minnesota regulators recently approved Google's Pine Island data center with Xcel Energy under a deal structure worth studying. The developer pays 100 percent of new grid infrastructure costs through a Clean Energy Accelerator Charge, funds 1.9 gigawatts of new wind, solar, and battery storage including the world's largest long-duration iron-air battery, and contributes $50 million toward grid reliability programs. Existing residential and small business customers are not seeing their bills rise as a result. Minnesota state law also now requires every large data center to contribute $2 to $5 million annually to home weatherization and energy efficiency for income-qualified residents. After the loss of federal clean energy incentives, deal structures like this are one of the few remaining mechanisms at scale to finance the grid Texas actually needs.

The current generation of builds is also moving rapidly toward closed-loop and air-side cooling that effectively eliminates daily water consumption, a meaningful change from the previous generation of facilities and one that should be standard going forward.

The honest framing on power is this: electrification of the broader economy is going to drive utility power demand up regardless of what happens with data centers. The question is whether the new load funds the buildout we need or just consumes from it. Structured well, data centers may be the single best tool Texas has to expand grid capacity, fund clean generation, and lower bills in the process. Structured badly, they push costs onto people who had no say. The difference is the deal. Our members are not just workers on these sites, they're neighbors, parents, and taxpayers, and they deserve the deal that gets it right.

Where we go from here

Texas can be a leader in the energy economy and the digital economy at the same time, if we build responsibly, transparently, and hold big corporations accountable for the deals they make with the public.

Not every developer is the same. Some of the largest companies in this space are showing up early, engaging with workforce partners, investing in clean energy and grid infrastructure, and asking communities what they need. Others are cutting corners and creating real problems in the places they land. Treating those two groups the same surrenders the leverage that would push standards up across the industry. The right response is strong, enforceable rules that reward the responsible developers and hold the bad actors accountable, not blanket opposition that lumps everyone together.

We will support projects that create real construction opportunities, respect the public, and protect the communities where our members live and raise families. We will oppose blank checks, long giveaways with vague promises, rushed approvals that shift environmental and infrastructure costs onto residents, and any development that degrades the quality of life for working Texans.

With the right policies and standards in place, the data center boom can deliver good union jobs, strengthen our energy system, lower utility bills, and benefit communities across Texas.

The boom is here. The question is whether Texans will get a good deal, and whether the work will be performed under standards that match the importance and scale of what is being built.