Texas Weighs Water Strategy as Demand for Data Centers Mounts

Texas lawmakers are weighing whether a surge in data center development will strain the state’s water supply—or help finance long-delayed efforts to expand it.

At a policy panel in Austin, officials said the scale of new projects tied to artificial intelligence is forcing a rethink of how Texas plans and pays for water infrastructure, even as demand continues to outpace supply.

State Sen. Charles Perry, a Republican, said the challenge is unfolding against a broader shortfall already baked into the state’s long-term outlook.

“Our current water plan will tell you we will not meet our water planning needs,” Perry said. ...