Democratic wins in the 2026 midterms, including Gina Hinojosa’s victory over Greg Abbott in Texas, have revived debate over data centers and their financing. Hinojosa, the governor-elect, has proposed pausing new permits until protections are adopted for local communities, electricity and water, while projects already under construction would reportedly be exempt. Texas hosts more than 400 data centers, and Jefferies estimates that 13 gigawatts of announced projects in the state are at risk. A permitting freeze would make existing capacity scarcer and more valuable, favoring major cloud providers that can finance their projects over independent developers dependent on credit. Projects diverted elsewhere could nevertheless intensify competition, giving an advantage to companies with the strongest financing resources.
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