T
exas is at the forefront of a data center boom, driven by its cheap electricity, abundant land, and business-friendly policies. The state has seen rapid growth in data centers, particularly those needed to run energy-intensive computations for artificial intelligence (AI). OpenAI, SoftBank, and Oracle are investing up to $500 billion in AI infrastructure through the Stargate project, with 20 data centers already under construction or planned in Abilene.

    As of September, Texas had 279 data centers, with 141 located in the Dallas-Fort Worth metro area. The boom is expected to drive up property demand and increase home prices in key areas, including parts of the Dallas-Fort Worth metro and Abilene. Realtor.com senior economic research analyst Hannah Jones notes that while Texas has kept up with climbing housing demand, affordability challenges persist.

    The data center boom also raises questions about whether the state's energy grid can keep up with demand. Texas has an independent electrical grid with no interconnections to out-of-state providers, which allows it to avoid federal energy regulations but means it must meet its own electricity needs. U.S. Rep. Marc Veasy suggests that the energy conversations surrounding the boom are not being discussed enough.

    To address this concern, nuclear technology startup Last Energy plans to build 30 small modular nuclear reactors near Haskell, TX, to help power the state's AI data center boom. The project aims to fulfill the state's growing data center demand and position Texas as a leader in advanced nuclear power.