Hinojosa Halts Texas Data Center Projects Pending New Protections

Texas will suspend new data center development until operators demonstrate benefits for local residents and comply with stronger protections, Governor-elect Gina Hinojosa announced Thursday, November 5. The incoming Democratic governor said rural communities have faced the consequences of rapid expansion without adequate regulations or meaningful involvement in decisions affecting their resources.

In an interview with CNN, Hinojosa identified inadequate legal protections and the impact on residents as reasons for changing the state's approach. She said her administration would prioritize safeguards before allowing further development.

"What has happened is data centers have moved into mostly rural communities, and there are no rules and laws to protect Texans and Texans are being taken advantage of. So the difference is we will have laws to protect Texans, and we need to stop what we are doing with data centers until we have those protections." Hinojosa told CNN.

According to data center tracking group Cleanview, Texas already has more than 80 operational facilities, making it the second-largest state for such infrastructure. Another 50 facilities are under construction, while more than 120 additional projects are planned.

Hinojosa also addressed the relationship between her incoming administration and technology billionaire Elon Musk, whose companies have significant interests in artificial intelligence. She indicated that business cooperation could continue under conditions established by the state.

"We can still have a strong working relationship with Elon Musk and his companies, but it has to be on our terms. It cannot be just running over the people of Texas. And that's what changes now that I will be governor." Hinojosa said on November 5.

Musk responded to Hinojosa's election victory a day earlier by discussing an alternative location for the infrastructure. The xAI chief executive has previously promoted the possibility of operating data centers in orbit.

"Data centers in space looking pretty appealing right now." Musk posted on X.

Although Musk is not responsible for every data center project in Texas, he has strongly supported the industry. His financial contributions to Republican political campaigns also became a prominent issue during the election.

Hinojosa made opposition to poorly regulated data center expansion a central part of her campaign against incumbent Republican Governor Greg Abbott. Abbott had previously promoted Texas as a major destination for artificial intelligence development before later retreating from those remarks and introducing a statewide construction moratorium.

Abbott's earlier position included describing Texas as the "epicenter of AI development."

Hinojosa clarified that her administration would not automatically reject the technology industry. She described Texas as remaining supportive of businesses while emphasizing that residents should participate in decisions about developments in their communities.

"Pro-business." Hinojosa said of the state's continuing economic approach.

She also explained that her objection concerned how companies had approached development rather than the facilities themselves. Her proposed policy would give residents a greater role in determining whether projects proceed.

"It is not that I hate data centers. I hate the way they are taking advantage of Texas, and that stops when I'm governor." Hinojosa said, adding that Texans should have a role in deciding whether facilities enter their communities.

Opposition to data center expansion also emerged across the United States during the November 2026 midterm elections. According to Data Centers on the Ballot, approximately 40 cities and towns considered measures restricting development, with at least 33 supporting additional regulations, construction moratoriums, or outright prohibitions.

NBC News exit polls found that 56% of voters considered artificial intelligence and data centers a crucial or major factor in their congressional voting decisions. Approximately 76% said they opposed constructing new data centers in their communities.

Republican Senator Ted Cruz, who was not seeking reelection in 2026, characterized the broader election results as a major rejection of his party's political position.

"Watergate-level repudiation." Cruz said of the election outcome.

The results included Democratic victories in congressional contests and Hinojosa's election as Texas governor, marking the party's return to the state's governorship for the first time this century.