Although data centers are yet to make their way into Lampasas County, there are close to 400 such facilities across the Lone Star State, with many beginning to enter rural areas.
The growth of data centers has revealed the stress such facilities place on water and energy infrastructure. Also, many data center developers are beginning to eye rural areas due to the availability of cheaper land and little in the way of regulation.
Infrastructure concerns
Data centers are specialized physical facilities designed to house and operate internet technology infrastructure, including computer servers, storage systems, networking equipment, and essential support systems like power and cooling. These facilities store, process and distribute massive amounts of digital data, serving as the backbone for the modern internet, cloud computing, artificial intelligence, streaming services, email, online banking, social media and other applications.
Apart from Virginia, no state has more data centers than Texas’ 392 facilities, according to datacentermap. com.
Local resident Janet Machen, who serves as vice president of the Lampasas County Farm Bureau Board of Directors, has several concerns with the rise of data centers.
“Most of Texas is endangered with our water availability, like parts of Lampasas County,” Machen said. “Our power grid is not that dependable as we found out several years ago. It appears as if these data centers are quietly sneaking into rural areas due to the lack of regulations.”
Machen is not wrong in her assumptions. Data centers require a sufficient water supply to keep servers and equipment cool and prevent the devices from overheating. A story from the Washington Post revealed data centers can use anywhere between 1 million and 5 million gallons of water per day.
Meanwhile, city of Lampasas water customers average a total of around 1.6 million gallons per day.
An analysis released this month by the Houston Advanced Research Center estimates that statewide the water data center usage was 25 billion gallons in 2025. The nonprofit organization says if data center growth projections continue, usage could grow up to 2.7% of the state’s total annual water usage.
Already, data centers account for 2% of the nation’s energy use, with that number expected to increase, according to the U.S. Department of Energy. The agency’s Energy Information Administration is projecting ERCOT’s electricity demand will increase 14% in 2026 due to several large centers and cryptocurrency mining facilities coming online.
PROJECTS IN NEIGHBORING REGIONS
While most data centers are located in Austin, San Antonio, Houston and the Dallas-Fort Worth metroplex, many are starting to pop up in more rural areas. Oracle and Open AI are working to develop a $500 billion facility in Abilene, and there are plans for a 100-acre crypto mining facility near Brady.
Texas rural areas with data center projects present or already in motion include Colorado City, Sweetwater, San Angelo and Dumas, as well as several other small municipalities.
If a data center were eyeing the unincorporated areas of Lampasas County, County Judge Randy Hoyer said the county would be limited in its authority to restrict the development. If the project abided by the county’s subdivision rules and regulations, the Commissioners Court would have its hands tied.
Lampasas County could restrict a data center project if the developer were to seek a tax abatement. Although data centers require significant water and electricity, they also bring significant tax dollars to local entities, potentially relieving a burden on taxpayers.
“These data centers are very financially good for the taxing entities, as they generate quite a bit of revenue,” Hoyer said. “I’m not sure of all the negative sides to it, but I have heard they do generate a significant tax base for the entities.”
Hoyer admitted he is not aware of the large amounts of water that centers require. “Obviously, that would be a huge negative,” he said.
Machen believes the county and Saratoga Underground Water Conservation District need to plan ahead for data centers that may loom on the horizon.
“I think our county government and Saratoga water authority needs to be as proactive as possible to effectively deal with these things,” Machen said.
SLOWING DOWN DATA CENTER GROWTH
Earlier this month, Texas Agriculture Commissioner Sid Miller introduced a plan he believes could be a blueprint for protecting prime farm and ranchland from data centers.
Miller is advocating for the creation of federal or state-designated Agriculture Freedom Zones, or AFZs, that would use tax incentives to drive developers away from agricultural lands.
“The unchecked spread of data centers onto prime farm and ranchland is a real and growing threat to our food supply,” Miller said in a news release. “But America also needs data, innovation and technology infrastructure to stay competitive. America will continue to lead the world in both agricultural production and technology innovation, but only if we do it the right way.”
Miller’s AFZ plan would steer data center development to more suitable areas of designation, including marginal land, brownfields, arid regions or locations with strong existing grid infrastructure and access.
Data centers in these designated zones could qualify for property tax abatements or other targeted tax breaks.
“Once you pave over good farmland, it is gone for good,” Miller said. “That means less food, higher grocery prices, and more pressure on the land and water farmers depend on. It is already happening. My plan uses targeted tax incentives, not mandates or handouts, to guide private investment where it makes sense.”
Hoyer told the Dispatch Record he is not aware of any data center interest in Lampasas County, nor has the Commissioners Court been approached about working with a data center developer.
“Not yet,” Hoyer said on the possibility of data center coming to Lampasas County. “We have had some solar projects and some people approach us about battery storage facilities but nothing yet regarding a data center.”
