Taylor, Texas Approves Deal for a Gas-Powered Data Center Campus

The Taylor City Council in Texas voted 5-0 on October 8, 2026 to approve a development agreement for a 664-acre data center campus. The developers are Big Watt Digital and PowerHouse Data Centers. The site, once called Project Mustang and now the Taylor Technology Campus, lies just east of the city limits. The city says the deal lets it annex the land and hold the developers to binding rules on water, noise, light and setbacks.

The campus would make its own electricity on site. CBS Austin reported that it is planned for 500 megawatts of data center capacity at full buildout. It said there is potential for another 500 megawatts later. A megawatt is a unit of power, and 1,000 megawatts make a gigawatt. In an October 9 press release, the developers said the site could deliver up to 1 gigawatt. No tenant has been named. The site's AI data center megaprojects tracker logs the vote.

What did Taylor's council approve?

The land sits between FM 112 and U.S. 79 in unincorporated Williamson County. The city says the county has no zoning authority and few development rules. Without an agreement, the city says, it would have had no authority over any part of the project. Under the agreement, the property will be annexed and held to binding rules.

The city lists these terms, among others:

• Water. Cooling must use a closed-loop system filled with reclaimed water, meaning treated wastewater. The first fill for the whole site is 1.575 million gallons. City drinking water is limited to restrooms, break rooms and similar uses. Cooling may use it only in listed cases, such as an emergency or a lapse in reclaimed water.
• Noise. Noise may not exceed the greater of 65 decibels or the level measured before development. Without the deal, only the state limit of 85 decibels would apply, the city says.
• Setbacks. Buildings must sit at least 300 feet from the north, east and west property lines. Along the south line, data centers, power plants and battery storage must be at least 700 feet away.
• Light. All lighting must meet the city's Dark Skies rules.
• Wastewater. The developers commit to wastewater upgrades meant to cut discharges into Mustang Creek. They will also withdraw their state wastewater discharge permit application.

Air emissions stay with the Texas Commission on Environmental Quality (TCEQ), the state regulator, with or without the deal.

Where will the campus get its power?

The developers say the campus is planned to use dedicated behind-the-meter generation. That means power made and used on site rather than bought from the grid. They say the site has access to natural gas that can support it. Fox 7 Austin reported that the plan pairs a 500-megawatt data center with a 750-megawatt natural gas-fired power plant. The city says the campus could sell power back to the grid when it makes more than it needs. The developers are targeting first power in the first half of 2028.

The plan comes as Texas tightens its review of data centers. In the summer of 2026, Gov. Greg Abbott set standards for them. His office says he told the state utility commission and the grid operator, ERCOT, to make data centers pay for their own power infrastructure. They must also reuse water and avoid disrupting neighborhoods. He also told the two bodies to pause pending data center grid connection requests until each project passes an ERCOT audit. That audit asks about plans for on-site generation.

On August 18, the governor's office said PowerHouse had committed to follow his standards. After the vote, the developers said the campus aligns with them.

Why did residents push back?

On August 18, 2026, Taylor's planning and zoning commission tabled the project for 90 days. It wanted more information and data center rules first. The developers withdrew their annexation and zoning application on September 3. The city kept negotiating and published the proposed agreement on October 2.

KUT reported that an overflow crowd came to City Hall for the vote. Many residents asked the council to vote no or to wait. Critics said the deal was negotiated behind closed doors, without more input from residents or the planning commission. Carrie D'Anna of the HALT Taylor Data Centers coalition told CBS Austin she worries about water use, air quality and noise. She also objected that Taylor's school district gets money when the site lies in the Thrall district.

The fight began earlier. In July, the city said a citizen petition for a temporary data center ban could not go forward. KUT reported that the petition had more than 1,400 signatures. The city said state law does not allow zoning changes by popular vote.

Supporters spoke too. Taylor ISD Superintendent Jennifer Garcia-Edwardsen told the council the agreement would benefit students, KUT reported. Mayor Jim Buzan called the terms the best path forward for Taylor and the surrounding area.

What do the developers promise in return?

The agreement includes $28.2 million in community commitments, according to the city:

• $13 million to the city for quality-of-life projects, including at least $750,000 for park upgrades for people with disabilities
• $10.2 million for Taylor ISD educational programs
• $1.5 million for Taylor ISD scholarships
• $1 million for Taylor ISD career and technical education, plus at least 20 student internships a year for three years
• $1 million for the city's animal care program
• $150,000 each to the Taylor Education Enrichment Foundation and the Boys & Girls Club of East Williamson County
• $1.2 million more for nonprofits over 10 years

The city cites a projected $1.38 billion in gross tax revenue over 20 years. That figure comes from a study by the consultancy RCLCO, which the developers commissioned. The city says the developers are not asking for tax abatements. The study also projects 19,350 temporary full-time-equivalent jobs in Williamson County during construction, according to the developers.

Recurring jobs are far fewer. The October 9 release put them at about 500 across the county once the campus is fully built, 320 of them in Taylor. An October 2 release had put the countywide figure at 320. The city's data center page notes that data centers employ relatively few permanent workers. It also says Samsung's project in Taylor has made the area more attractive to some data center developers.

What happens next?

• Annexation. The site is to be brought into city limits under the agreement.
• Studies before building. A noise study at the property lines must set a baseline before development. A traffic study is due before a preliminary plat, an early subdivision map. A lighting plan goes with the building permit application.
• Construction. The developers project construction from 2027 to 2029.
• City rules. The city is drafting wider data center rules on water use, noise, light, air pollution and buffers. As of a June 30 update, it said residents would get to comment before adoption.

The developers have not named a tenant or a construction cost. None of the sources cited here says whether a state air permit for the gas plant has been filed.