Pablo Vegas, CEO of the Electric Reliability Council of Texas (ERCOT), said the company is projecting that the state will need to nearly double its energy production over the next six years, thanks to new data centers and crypto-mining facilities that are planning to come to the state.
Previously, ERCOT predicted that the grid would need to grow from 85,000 MW to 110,000 MW to keep up with demand. But last week, Vegas said the agency had to raise that estimate to 150,000 MW by 2030 because more data centers, hydrogen production facilities and oil and gas companies have asked to connect to the grid.
“All of that is putting together a picture of a very significant, different demand growth that is forcing us to really re-think how we’re looking at planning to make sure we can meet those needs and continue to deliver on the expectations of all Texans,” Vegas said.
Much of this growth is coming from the Permian Basin, where oil and gas companies are transitioning to electric operations. In addition, data centers and cryptocurrency mining facilities are demanding significant amounts of electricity, sometimes several times more than entire cities currently use.
State Sen. Charles Schwertner raised concerns about entities like bitcoin mining companies profiting from the electricity market by selling back pre-purchased power during tight grid conditions, which has led to higher power bills for Texans.
Lt. Gov. Dan Patrick also expressed concerns over the projections.
“Crypto miners and data centers will be responsible for over 50% of the added growth. We need to take a close look at those two industries,” He wrote on Twitter/X. “They produce very few jobs compared to the incredible demands they place on our grid. Crypto mining may actually make more money selling electricity back to the grid than from their crypto mining operations.”
The projections are also affected by a new law that allows officials to consider a company’s request for grid connections before they are finalized. This makes that most data centers are considered for the grid, even if they still are building a facility in the state.
“There’s a lot of unknowns,” Cyrus Reed, conservation director of the Lone Star Chapter of the Sierra Club, told the Texas Tribune. “But it’s what they’re putting into their system for planning purposes.”
Electricity experts also pointed out the necessity of expanding transmission lines to meet the projected demand, a process that requires significant time and investment.
Despite these uncertainties, experts agree on the need for additional power generation and improved transmission infrastructure.
