Texas Law Lets ERCOT Cut Power to Big Data Centers in Grid Emergencies

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Texas has enacted a new law, Senate Bill 6, which empowers the Electric Reliability Council of Texas (ERCOT) to disconnect large data centers and other high-energy consumers during power grid emergencies. This legislation, effective from June 2025, aims to prevent widespread blackouts similar to those experienced during Winter Storm Uri in 2021. The law specifically targets facilities with energy loads of 75 megawatts or more, allowing ERCOT to mandate curtailment of these non-essential loads to prioritize electricity for critical services like hospitals and homes.

The introduction of this law presents operational challenges for the data center sector, which must now prepare for potential disconnections and disclose backup power capabilities. While some industry insiders express concerns about the financial impact of downtime, supporters argue that the law is a necessary measure for grid stability. The legislation reflects a growing recognition of the need to balance the rapid growth of energy-intensive industries with the reliability of Texas's power infrastructure, setting a precedent for how states manage the intersection of technology and energy demands.