Texas Democratic wins could slow Stargate and other big AI data centers

Texas is the fastest-growing data center market in the US and ground zero for Big Tech's largest AI buildouts. MIT Technology Review argues that the midterm results may jeopardize that position.

Democrat James Talarico won the US Senate seat against Ken Paxton. Gina Hinojosa won the race for governor against the Republican incumbent, Greg Abbott. Democrats will also take control of the Texas House for the first time in 24 years. Talarico and Hinojosa made data centers a central issue and talked about them constantly on the campaign trail.

The industry saw the shift coming. At the DCD conference in Ashburn, Virginia, on Tuesday, panelists lamented that Texas had been the easiest place to build for years, until September. That month Abbott, perhaps seeing the increasingly bipartisan distaste for these facilities, began changing course himself. Developers said the governor's office had stopped responding to their emails. On September 21, Abbott directed a key state regulator to halt data center permits. Many panelists expected this to mean existing projects might be slowed and new ones could be halted altogether.

The governor-elect seems eager to go further. Hinojosa supported tax breaks for data centers in 2023 as a way to boost construction jobs, but during her campaign she began pushing for a full-fledged moratorium.

That would be a problem for the hyperscalers, which have ambitious plans for AI training facilities in the state. The Stargate Frontier data center in Shackelford County is projected to serve 1,820 megawatts. That is about as much as the nation's largest data center, SpaceX's Colossus 2 in Tennessee, and more than twice as much as the largest data center currently operating in Texas. Nexus Hubbard, also under construction and intended mostly to serve Anthropic, has a planned size of 6,400 megawatts. It is the second-largest data center being built in the US, behind only Meta's Hyperion project in Louisiana.

The article says possible Democratic delays or moratoriums add to growing anxiety that the AI buildout could stall. Banks and lenders are already getting pickier about the projects they back, and because the buildout underpins current economic growth, those forces combined could have ripple effects. Nationally, voters supported efforts to protect ratepayers from electricity bill increases caused by data centers and favored some larger bans on new data centers altogether.

Whether the Texas counties with the most data centers helped elect these Democrats, or the anti-data-center vote came from elsewhere, is described as a key open question, and the county results were mixed. Much of the buildout is around Dallas. Dallas County and others closest to it went blue, but nearby Ellis County, which leads in permitting requests for data centers, went for Abbott and Paxton. Cameron County, near the southern border, is a hot spot for data centers and voted blue, which was a shift. Mitchell County and Scurry County, home to a number of projects in west Texas, went red.

This matters because no single office in the state decides whether a project goes ahead or is halted; decisions often reflect an interplay between city governments, county officials and state offices. Local officials may resist sweeping restrictions from the state, and Democrats pushing a moratorium might face pushback from the construction unions that supported some of their campaigns. So while the blue wave spells a death knell for Texas data centers in theory, the article concludes, winners may find that following through once in office is much more complicated than campaigning on it.

Key facts

Democrats won the Texas US Senate seat (James Talarico over Ken Paxton), the governorship (Gina Hinojosa over incumbent Greg Abbott) and the state House, their first control of it in 24 years.
Hinojosa backed data center tax breaks in 2023 but pushed for a full-fledged moratorium during her campaign; on September 21, Republican Abbott had already directed a state regulator to halt data center permits.
Stargate Frontier in Shackelford County is projected at 1,820 megawatts, and Nexus Hubbard, intended mostly to serve Anthropic, has a planned size of 6,400 megawatts.
County results in data center areas were mixed: Ellis County went red, Cameron County blue, Mitchell and Scurry counties red.
No single office decides whether a project proceeds, and local officials and construction unions could complicate any sweeping state restrictions.

Why it matters

Texas hosts some of the largest AI infrastructure projects in the world, and the article ties a political shift to the economics of the AI boom. Stargate Frontier (1,820 megawatts) is projected at more than twice the largest data center now operating in Texas, and Nexus Hubbard (6,400 megawatts, mostly for Anthropic) would be the second-largest data center being built in the US. Delays or a moratorium would add to anxiety that the buildout could stall, at a time when banks and lenders are already getting pickier and the buildout is underpinning economic growth.

Who it affects

Hyperscalers and developers with projects in Texas, including those behind Stargate Frontier and Nexus Hubbard, and Anthropic as the intended main user of Nexus Hubbard. It also touches lenders weighing which projects to back, local and county officials who have a say over development, and the construction unions that supported some Democratic campaigns. Ratepayers are part of the story too: voters nationally backed protection from data-center-driven electricity bill increases.

How to use it

Treat this as a map of what to watch rather than a forecast. The article points to a few things: how the governor's permit directive from September 21 plays out for existing and new projects, whether Hinojosa follows her campaign call for a moratorium once in office, how city, county and state offices interact on individual projects, and whether construction unions push back. The county results (Ellis and the west Texas counties red, Cameron blue) show that local politics around data centers do not map cleanly onto the statewide result.

How solid is it

The reporting rests on named election results, named projects with stated capacities, and the account of the DCD conference panel. The conference claims come from unnamed panelists and developers, and no named person is quoted. The article offers no vote totals and no responses from Anthropic, Stargate, Meta, SpaceX or other developers. It also does not establish that data center areas drove the Democratic wins, and it calls that question open. The framing that the blue wave may jeopardize Texas's position is the article's own assessment.

Risks and caveats

No moratorium has been enacted; the article says only that Hinojosa pushed for one during her campaign, and it gives no timescale for any delays or restrictions. The article does not say which regulator Abbott directed or whether permits were in fact halted afterwards. Because decisions depend on city, county and state offices, and local officials may resist sweeping state restrictions, the outcome is uncertain. The article itself says that following through may prove much more complicated than campaigning on it.

“no single office in the state decides whether a project goes ahead or is halted”

— MIT Technology Review