Data Centers

Economic Development Incentives are considered on a case-by-case basis and projects must be fully compliant with adopted City ordinances, policies and plans.

A data center is a physical facility that houses IT infrastructure — including servers, storage devices, and networking equipment — used to store, process, and manage digital operations and data.

Any time you send an email, stream a video, use a cloud-based application, access medical records, or make a banking transaction, that request is processed by equipment inside a data center. 

The City of Fort Worth does not control every factor that influences data center development, however, the City does have a role in using local tools to protect the community. 

City of Fort Worth

The City of Fort Worth's authority is focused on four areas: zoning regulations, noise regulations, water utility requirements, and City economic development incentives.  

The City cannot replace state law or regulate areas assigned to state or federal agencies, but it can require local protections when a project comes into the city limits and receives City utility service.

State of Texas

The State of Texas holds authority over several key areas. On energy, the Public Utility Commission of Texas and the Electric Reliability Council of Texas (ERCOT) govern grid access, interconnection, and reliability — meaning the City has no direct control over whether or how a data center connects to the power grid. Statewide water planning falls to the Texas Water Development Board (TWDB). Air quality regulation is the domain of the Texas Commission on Environmental Quality (TCEQ). State tax exemptions and incentives are administered by the Texas Comptroller of Public Accounts and the Texas Economic Development and Tourism Office.

City staff has already identified specific concerns related to data centers and proposed regulations to address them. Those regulations are scheduled for consideration and potential adoption by August 11.  Because the City is moving forward with new regulations, staff is not recommending a moratorium. Initiating a moratorium would add several procedural steps and delay the adoption of the proposed regulations by two to three months. 

A moratorium is a temporary pause on certain types of new development to allow a city time to study and prepare regulations to address specific development issues. 

Under the Texas Local Government Code, a moratorium requires specific certain requirements, including specific notice and public hearings, written findings to justify the moratorium, and the City must adopt development regulations at the end of the moratorium. Moratoriums have an initial duration of 90 days and may be extended for an additional 90 days provided certain process and findings are followed.   

Moratoriums also have limitations. It cannot be used to regulate issues outside the City’s authority or prohibit a lawful land use. It does not apply to vested projects, approved projects, or those with zoning applications already submitted, meaning projects in progress are not halted.  

The earliest a moratorium would become effective is mid- to late October. The adoption of regulations would occur at the end of the moratorium period in January 2027, approximately 5 months after the date staff is proposing to adopt regulations for data centers: 

Yes, there have been data centers operating in Fort Worth for more than two decades. The City currently has four data center developments spanning 10 individual buildings across Council Districts 5 (1 development) and 10 (3 developments), with a combined footprint of more than 3 million square feet. Individual facilities range in size from 209,000 square feet to a 1.5-million-square-foot campus, with an average building size of 275,000 square feet. The first data center in Fort Worth was built in 2000; the most recently completed construction in 2025.

There is also in progress development. Within city limits, one additional facility is currently under construction in Council District 7, and four more have been proposed across Council Districts 3, 6, 7, and 8. Two further data center projects have also been proposed in Fort Worth's extraterritorial jurisdiction. 

It is anticipated that the Texas State Legislature will consider legislation action related to data centers in the next Legislative Session. Several House and Senate Committees are currently studying data center-related interim charges, including impacts on the electric grid, water supply, infrastructure, economic development, and regulation.

During the 89th Texas Legislature (Regular Session), Senate Bill 6 was signed into law and became effective on June 20, 2025. Its purpose was to establish a regulatory framework to manage the rapid growth of consumers with high electricity demand, such as data centers. It sought to address the concerns around grid reliability, cost allocation, data transparency and credibility, and protecting residential customers during grid emergencies.

Tarrant Regional Water District (TRWD) is the sole and exclusive provider of raw water to the City of Fort Worth. That contract prioritizes supply for Fort Worth alongside Arlington, Mansfield, and the Trinity River Authority (TRA).

Looking further out, the State Water Plan forecasts that TRWD will need additional water supply over the next 50 years to serve both existing and proposed customers. The plan identifies actionable strategies and financing sources to meet it.

The $2.3 billion Integrated Pipeline project is a cornerstone of the region's long-term supply infrastructure. TRWD is also designing indirect reuse projects at Mary's Creek and Cedar Creek Reservoir, with construction anticipated to begin within the next five years. Additional supply strategies are incorporated into both the State Water Plan and TRWD's own Integrated Water Supply Plan.

The proposed requirement that all new data centers use closed loop cooling systems is consistent with long-range planning strategies.

Water use varies by each site's specific operational needs and design.

Estimates normalized to an example of 100 acres of land in Fort Worth:

• Data center utilizing a closed loop cooling system uses 300,000 - 1 million gallons of water per month on average. 
• Data center utilizing an evaporative cooling system uses 4 - 6 million gallons of water per month on average.

To put that water use in perspective, a single-family residential development on 100 acres of land in Fort Worth uses approximately 2 million gallons of water per month on average.

How are air emissions and wastewater discharge handled?

Air emissions and wastewater discharge are regulated primarily at the state and federal level through agencies such as Texas Commission on Environmental Quality (TCEQ) and the Environmental Protection Agency (EPA).

Air

The Texas Commission on Environmental Quality (TCEQ) oversees air quality requirements for data centers in Texas. TCEQ reviews air permit applications, regulates emissions standards, and enforces state air quality regulations. The City of Fort Worth responds to air quality complaints. City staff are trained to conduct air quality compliance inspections, to document site conditions, and to refer violations to TCEQ.

For more information about TCEQ air permitting, visit: www.tceq.texas.gov/permitting/air/air_permits.html

The City is proposing additional regulations related to generators on data decenter developments, including required distances from residential, screening, and restricting testing schedules to weekdays between 8 a.m. and 5 p.m.

Wastewater

The City of Fort Worth’s Water Utility requires wastewater studies to determine impacts, needed improvements, and permit requirements. The permitting process provides:

• protection of the sewer collection system, 
• protection of wastewater treatment operations, 
• protection of utility workers and public health, 
• prevention of unauthorized chemical discharges, 
• enforceable accountability measures, 
• ongoing monitoring and oversight, 
• and verification/certification requirements that can be investigated and validated by City staff.

One of the proposed regulations is that the City require data centers obtain wastewater pretreatment permits as Non-Significant Industrial User (NSIU). The City would issue the NSIU pretreatment permit, in accordance with TCEQ rules and the City’s local ordinance. Doing so allows the City to require and enforce:

• chemical disclosure and Safety Data Sheets (SDS) submission, 
• spill prevention and slug control plans, 
• secondary containment, 
• monitoring and inspection access, 
• discharge limitations, 
• annual certifications, 
• employee/operator training, 
• reporting requirements, 
• and emergency notification procedures. 

Closed-loop cooling means the cooling system is designed to reuse water within the system rather than continuously drawing large amounts of new water for cooling operations.

One of the proposed amendments would require that all new data centers use closed-loop cooling systems.

Data centers do require significant electricity, however, the electric grid is not controlled by the City of Fort Worth. Decisions about grid operations and electric infrastructure are made outside the City’s authority. 

Electric generation, transmission planning, and regional grid reliability are governed through the Electric Reliability Council of Texas (ERCOT), Public Utility Commission of Texas, Oncor, and state law. 

During the 89th Texas Legislature (Regular Session), Senate Bill 6 was signed into law and became effective on June 20, 2025. Its purpose was to establish a regulatory framework to manage the rapid growth of consumers with high electricity demand, such as data centers. It sought to address the concerns around grid reliability, cost allocation, data transparency and credibility, and protecting residential customers during grid emergencies. 

Data centers generate an impactful amount of property tax revenue to fund City services and infrastructure. Over the last five years, data centers have generated more than $83 million in gross property tax revenue for the city.

In 2024, gross property tax revenue from data centers equaled the equivalent of what the city collects from roughly 8,300 average single-family homes. By 2030, based on known in progress development, that figure is projected to grow to the equivalent of more than 22,700 homes.