While New York delays data centers with study, Texas finds solutions
If you listen to political debate from the state capitol, you’d think the only way to have data centers in New York state is to power them with a power grid that is already struggling under increasing electric loads. How can the state power data centers when it’s struggling to power its transition to an all-electric power grid without data centers?
Accepting that assumption as true is one of the biggest arguments against data centers in New York state. But, as we learned recently from Cummins Engine, New York residents are being fed a half-truth.
Texas is building data centers like a child builds sand castles at the beach. But some of these data centers aren’t powered off of the Texas electric grid – they’re powered by natural gas-powered generators provided by Cummins and companies like it.
Texas’ main grid operator predicts power demand will nearly double by 2030 in part due to more requests to plug into the grid from large users like data centers, crypto mining facilities, hydrogen production plants and oil and gas companies, the Associated Press reported in 2025 in the wake of President Donald Trump’s announcement that Stargate, a joint venture between OpenAI, SoftBank and Oracle, will invest up to $500 billion in AI-related infrastructure. Texas will serve as ground zero, with 10 data centers by the venture already under construction in the state, 10 more on the way and the first project based in Abilene, Oracle CEO Larry Ellison said. Each building will occupy half a million square feet.
Cummins is part of that development, with natural gas-fueled generator sets and integrated microgrid controls designed to address power grid constraints, improve reliability and enable fast-start response capabilities in an era of unprecedented AI demand. Cummins is supporting one data center company’s behind-the-meter power need for their AI HPC data center campuses by utilizing two of Cummins’ high-horsepower natural gas generator sets as the primary power source – without reliability on the grid.
People are still, by and large, opposed to data center development. We’ve seen that opposition in Chautauqua County in recent months. There are environmental questions to be answered. But much like highly opposed wind and solar power projects, it’s likely there will be sites in Chautauqua County that eventually become home to data centers. It’s good to know there are other options to power those centers other than relying on the state’s electric grid – if the state can get over its hangups with natural gas.
If one wants to see why the Texas economy is booming, look no further than the way New York and Texas are handling data centers. New York needs to study and delay. Texas is embracing a new method of tax base development and is working with private companies to find solutions – and its taxpayers are benefitting.
