Houston Business Alert: Texas Power Grid Faces Increased Winter Blackout Risk as Data Center Demand Surges

Texas sits at the epicenter of this transformation. The state’s abundant energy resources, business-friendly regulatory environment, and relatively low electricity costs have made it a magnet for energy-intensive industries. OpenAI, for example, is developing its flagship Stargate AI campus in Abilene, approximately 150 miles west of Dallas-Fort Worth. That single facility could require up to 1.2 GW of power—equivalent to a large nuclear plant.

 Key Findings from the NERC Winter Assessment

The assessment identifies several concerning trends that could impact grid reliability during the upcoming winter season:

• Winter electricity demand forecasts have increased by 20 GW (2.5%) compared to last year, with some assessment areas projecting increases near 10%
• Total BPS resources have increased by only 9.4 GW, meaning demand growth is outpacing new supply additions
• Data centers are altering daily load patterns with their round-the-clock operations, lengthening peak demand periods and making battery storage management more challenging
• Four severe arctic storms have descended across much of North America since 2021, exposing vulnerabilities in generation and fuel infrastructure
• Natural gas infrastructure freeze protection remains voluntary in most of North America, creating continued supply risks during extreme cold

The assessment specifically highlights Texas RE-ERCOT as facing elevated risk during extreme winter weather conditions. With an Anticipated Reserve Margin of 36% and a Reference Margin Level of 13.75%, Texas appears well-positioned for normal winter conditions. However, the scenario changes dramatically during extreme cold weather events.

(Winter Reliability Risk Area Summary – Source: NERC 2025–2026 Winter Reliability Assessment)

 The Texas Data Center Explosion

The numbers coming out of Texas are staggering. Grid operator ERCOT has received more than 220 GW of project requests seeking grid connections as of November 2025—a 170% increase over the 83 GW of requests recorded in January. Approximately 73% of these connection requests are from data centers.

To put this in perspective, if all requested projects were actually built, they would consume electricity equivalent to nearly 154 million Texas homes. The state’s population is only about 30 million people. Beth Garza, a former head of ERCOT’s watchdog organization, has expressed skepticism that all these projects will materialize, describing the scale of the numbers as extraordinary. More than half the projects haven’t even submitted planning studies yet.

Still, the projects ERCOT has already approved to connect represent 7.5 GW of new demand—a substantial amount by any measure. For comparison, the six-county Philadelphia metropolitan region, with a population of 1.7 million, had peak demand of about 8.6 GW in 2024.

(Seasonal Risk Assessment Summary – Source: NERC 2025–2026 Winter Reliability Assessment)

 The Winter Storm Uri Warning

The specter of Winter Storm Uri continues to loom over Texas energy planning. That February 2021 catastrophe represented the largest manually controlled load shedding event in U.S. history:

• 4.5 million people lost power for several days during freezing temperatures
• At least 210 people died during the storm, many from hypothermia, carbon monoxide poisoning, or medical conditions worsened by the cold
• ERCOT ordered 20 GW of rolling blackouts to prevent total grid collapse
• Natural gas production plummeted as supply infrastructure froze, while power plants went offline in large numbers

The NERC assessment warns that similar conditions could occur again. Texas has 92.6 GW of available resources under normal conditions, and peak demand in an extreme Uri-like scenario could reach about 85.3 GW. That appears manageable until you factor in the reality that available power could fall to around 69.7 GW in extreme winter weather due to plant maintenance, forced outages, and capacity reductions from winter conditions. That would leave a supply deficit of more than 15 GW.

 The Natural Gas Vulnerability

Natural gas remains the critical fuel for winter electricity generation across much of North America. The assessment notes that single-fuel natural gas generators make up 38% of MISO’s and ERCOT’s winter resource mix – the highest percentages among all assessment areas.

The challenge is that natural gas supplies can become constrained precisely when they’re needed most:

• Extreme cold temperatures affect natural gas production infrastructure through freezing issues
• Pipeline capacity becomes fully subscribed as heating demand competes with power generation demand
• Generators without firm fuel delivery contracts may be unable to access fuel during peak demand periods
• Timing misalignments between natural gas and electricity markets create procurement challenges, especially around winter holiday weekends

The good news is that evidence from the past two winters indicates improvement in natural gas delivery since Winter Storms Uri and Elliott, with less production decline during cold weather and fewer infrastructure failures. However, because freeze protection for natural gas facilities remains voluntary in most areas (Texas being a notable exception), vulnerabilities persist.

(Single-Fuel Natural-Gas-Fired Generation Capacity Contribution – Source: NERC 2025–2026 Winter Reliability Assessment)

 The Battery Storage Paradox

Battery storage has emerged as a significant new resource type, with nearly 20 GW of nameplate capacity added to the BPS since last winter. However, the assessment raises important questions about battery effectiveness during extended extreme weather events.

Battery resources provide reliable power when they can be dispatched and have sufficient charge. But during multi-day cold weather events, there may be little opportunity to recharge batteries between peak demand periods. With data centers flattening the daily load curve through their 24/7 operations, maintaining sufficient battery state of charge becomes increasingly challenging during extended high-load periods like those experienced during Winter Storm Uri.

System operators will need better visibility into battery state of charge and should plan for scenarios where these resources become depleted when needed most.

 What Has Improved Since Uri

The assessment acknowledges significant progress in winter preparedness since the catastrophic 2021 storm:

• FERC approved enhanced cold weather reliability standards (EOP-012-3) in September 2025, addressing generator freeze protection, cold weather preparedness plans, and operator training
• ERCOT has conducted over 2,000 generation resource and transmission service provider winter weatherization inspections since 2021
• Texas adopted rules requiring critical natural gas facilities to implement weather-related emergency preparation measures
• 96% of total net winter capacity reported extreme cold weather temperatures at or below 32°F, triggering winter preparedness measures
• 99% of total net winter capacity in the continental U.S. reports ability to operate at calculated extreme cold weather temperatures

These improvements were tested during the January 2025 arctic events (Winter Storms Blair, Cora, Demi, and Enzo), which included record-setting cold and snowfall in Louisiana and the Gulf Coast. Despite temperatures approaching historic lows in some areas, no manual load shed was required—a significant improvement over previous extreme cold events.

 The Outlook for Winter 2025-2026

For the upcoming winter, NERC’s probabilistic risk assessment for ERCOT indicates a 2% probability of declaring energy emergencies during the January peak day, with a 1.8% probability of controlled load shed. These figures assume expected system conditions – extreme weather could significantly increase these probabilities.

The U.S. Energy Information Administration anticipates a slightly milder winter than last year across much of the United States, particularly in the Northeast. Working natural gas storage inventories are about 5% above the five-year average heading into winter, providing some buffer against supply disruptions.

However, forecasts only go so far. As the assessment bluntly notes, wide-area cold snaps can drive sharp increases in electricity demand while simultaneously threatening reliable generation and fuel supplies. The combination of rapidly growing data center load, a changing resource mix, and the ever-present possibility of extreme weather creates an environment where careful planning and preparation are essential.

(ERCOT Assessment – Source: NERC 2025–2026 Winter Reliability Assessment)

 How CinchOps Can Help

Houston-area businesses face unique challenges as the Texas power grid adapts to unprecedented demand growth. Whether you’re concerned about protecting critical systems during potential grid emergencies or looking to improve your facility’s energy resilience, having a trusted managed IT services partner makes all the difference.

CinchOps provides comprehensive solutions to help your business prepare for and respond to grid reliability challenges:

• Business Continuity Planning: We help develop and test comprehensive plans that keep your operations running during power emergencies, including failover procedures and communication protocols
• Network Infrastructure Resilience: Our team designs and implements redundant network architectures that maintain connectivity even when primary power systems are compromised
• Power Management Solutions: We integrate UPS systems, generators, and intelligent power management into your IT infrastructure to ensure critical systems remain operational during outages
• Remote Monitoring and Management: Our 24/7 monitoring capabilities let us detect and respond to power-related issues before they impact your business operations
• Disaster Recovery Services: We implement robust backup and recovery solutions that protect your data and minimize downtime during extended outages
• Cybersecurity During Emergencies: Power disruptions can create security vulnerabilities—we ensure your systems remain protected even during grid emergencies

Don’t wait for the next winter storm to expose vulnerabilities in your IT infrastructure. Contact CinchOps today to discuss how we can help your Houston or Katy area business build resilience against grid reliability challenges.

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For Additional Information on this topic: Texas Data Center Expansion Raises Blackout Risk During Extreme Winter Weather

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