During one of the coldest weeks of 2021, Winter Storm Uri hit Texas, cutting out the power grid across the state for millions of homes. The days-long blackout that followed was devastating.
Texas is the only state in the country that has its own power grid independent of federal regulation, and it’s run by the Electric Reliability Council of Texas (ERCOT). After the 2021 storm, it was clear to many Texans that the state grid, as it was, was dangerous and unreliable if it couldn’t handle a similar crisis in the future.
The state Legislature started drafting Senate Bill 6 in response to Winter Storm Uri, authored by state Sens. Phil King (R-Weatherford) and Charles Schwertner (R-Georgetown), meant to ensure that Texans’ power stays on through such an emergency. But how?
As of June 20, when SB 6 was signed into law, ERCOT electricity managers now have the ability to shut off power for customers that use a large amount of energy, like AI data centers and cloud storage facilities, and redirect the saved power for residents during emergency situations.
Such big users are defined in the bill as those using 75 megawatts or more. What’s notably not included in the bill is what will actually qualify as an “emergency” or period of high energy demand. In a statement to the Chronicle, an ERCOT representative wrote, “ERCOT will be working with the PUCT [Public Utility Commission of Texas] and other stakeholders in determining the thresholds for using these new tools.”
SB 6 also requires that data centers and other large customers disclose much more information to ERCOT than they previously did, such as their alternate energy sources and backup power generators. Moreover, new developers planning to use a large amount of power must now pay $100,000 to the PUCT, which will conduct a study on their proposal’s burden on the grid.
ERCOT projects that by 2031, the grid will need to double the energy it produced in 2024
During the session, critics argued that SB 6 infringes on the state’s free market, business-friendly approach to its independent energy grid, which offers low energy costs to new developers. As Texas continues to develop industrially and grow in population by an estimated 10% every decade, the SB 6 debate was yet another argument between prioritizing economic development in Texas and making sure that, at the end of the day, we’ll end up with enough water and energy resources for residents.
ERCOT projects that by 2031, the grid will need to double the energy it produced in 2024, from 85 gigawatts to up to 218 gigawatts, in large part due to the surge of data centers to Texas. AI data centers usually run on power 24/7, and the potential of ERCOT-imposed downtime could cause those developers to look elsewhere, critics of the bill argued.
Nonetheless, the ERCOT representative maintained in writing that, “As with similar policies being considered in other parts of the country, the impact on investment and development of new data centers in Texas should be minimal.” The bill’s author, Sen. King, added in a statement that Texas is still “open for business.”
This article appears in August 22 • 2025.
