DALLAS — North Texas has become the world’s leading primary data center market as developers expand facilities to meet demand for artificial intelligence, while cities and residents across the region raise concerns about water use, electricity demand, infrastructure and environmental impacts.
A recent report from real estate firm Cushman & Wakefield ranked Dallas-Fort Worth as the No. 1 primary data center market in the world.
The rapid growth has outpaced the ability of some local governments to prepare for new projects. A recent survey from the North Central Texas Council of Governments found that many cities and counties lack the infrastructure needed to support additional data centers.
About 96% of survey respondents identified water resources as the area most likely to face strain from data center development, while 81% cited pressure on the power grid.
Susan Alvarez, environment and development director for the council of governments, said developers often complete site planning and due diligence before notifying local governments, leaving communities to catch up with the infrastructure demands.
The concerns have prompted local governments to consider development restrictions as the region continues to attract large-scale facilities designed to support artificial intelligence.
In Fort Worth, the City Council recently approved steps toward a moratorium on new data center construction, along with filing requirements and a task force to study regulations. The moratorium would not affect projects already under construction.
Fort Worth has seven planned data centers, including a proposed $10 billion project from Black Mountain and a $1 billion facility from Edged Data Centers. Residents have raised concerns about water, electricity, land use, natural habitats and quality of life.
In Denton, the City Council has taken steps to pause future data center development for up to 180 days while officials consider changes to development rules. Proposed requirements include water and wastewater studies and the use of closed-loop or air-cooled systems.
Denton currently has two data center projects. Core Scientific operates an artificial intelligence facility that is nearing a planned capacity of 391 megawatts, while QumulusAI is developing a modular facility with up to 20 megawatts of capacity.
The projects have generated tax and other revenue for Denton. City staff reported that data centers have contributed more than $3.1 million in property taxes, $475,000 in sales taxes, more than $8.8 million in electric-use franchise fees and more than $2 million in lease revenue.
In Collin County, the Prosper Planning and Zoning Commission unanimously rejected a rezoning request Tuesday for Project Tomahawk, a proposed $580 million data center. The 225,000-square-foot facility would occupy about 37 acres near FM 1385 and Parvin Road.
Commissioners cited concerns about noise, electricity consumption, environmental impacts and the project’s compatibility with Prosper’s long-term land-use plans. More than 400 written comments opposed the project.
The Prosper Town Council is scheduled to consider the proposal Sept. 8.
Communities in Dallas and Ellis counties also face an increase in proposed hyperscale campuses. Amazon and Google have registered plans for facilities near Lancaster, Red Oak and Wilmer, where residents have urged local officials to delay or reconsider development.
Wilmer has seen several city officials resign or lose their positions amid disagreements over proposed data centers.
Rural communities south of Fort Worth also face growing development pressure. Hood and Somervell counties have at least eight data center projects operating or in the planning stages, including projects near Dinosaur Valley State Park and within Granbury.
Granbury residents are seeking to revive a recall effort targeting the mayor and four City Council members over their handling of Project Patriot, a proposed data center and power-generation campus on about 2,000 acres at Knox Ranch.
An appeals court is considering the dispute after Granbury rejected five recall petitions. Organizers said they collected more than 5,000 signatures, while the city said it could verify only 26.
The expansion has also drawn attention at the state level.
Gov. Greg Abbott, who last year described Texas as a global centerpiece for artificial intelligence and data centers while announcing a $40 billion Google investment, has since called for audits of water and electricity use at as many as 300 proposed projects.
Abbott directed the Electric Reliability Council of Texas and the Public Utility Commission of Texas to conduct the audits and pause grid connections for affected projects until the reviews are completed.
Data centers have also entered the 2026 political debate. The industry has contributed thousands of dollars to Attorney General Ken Paxton’s U.S. Senate campaign, while Democratic candidate James Talarico has called for tighter regulations on data center development.
The rapid expansion has created a balancing act for North Texas communities, which stand to receive tax revenue and economic investment while confronting the infrastructure demands associated with increasingly large facilities.
