A Texas regulator warned Monday that government rules are the “biggest threat” to building AI data centers as demand for power surges.
Speaking at the EarthX conference in Dallas, Wayne Christian, Commissioner at the Railroad Commission of Texas, said regulatory costs and delays are slowing the development of the infrastructure needed to support the growth of artificial intelligence.
“The biggest threat we have with development or AI centers is government regulation,” Christian said during a panel on powering the next industrial era, adding, “so if government regulation would back off on some of this stuff … it increases the cost.”
Christian cited past nuclear permitting requirements as an example, noting that federal rules once required tens of millions of dollars in upfront financial commitments, which he described as a burden on development. He argued that similar regulatory pressures are now affecting AI-related energy and data infrastructure.
The discussion comes as AI investment accelerates nationwide. An analysis of job posting data found that AI created roughly 640,000 U.S. jobs between 2023 and 2025, including roles such as AI engineers and heads of AI, though that figure does not include large numbers of temporary construction jobs tied to building data centers, The Wall Street Journal reported.
Where some jobs have been created, research indicates others have been destroyed. A net of 16,000 fewer jobs per month were created over the last year as a result of AI, with most of the burden being borne by Gen Z, according to calculations from Goldman Sachs, reported by Fortune.
Texas has emerged as a focal point of the AI expansion. The state could surpass Northern Virginia as the world’s largest data center market by 2030, with 6.5 gigawatts of capacity under construction and billions in planned investment from major technology firms, according to a report cited by The Dallas Express.
At the same time, infrastructure constraints are mounting. Grid connection timelines can stretch four years or longer, forcing developers to plan projects far in advance.
Christian framed regulation as a broader economic issue, arguing that government intervention can distort markets and discourage investment. “It completely kills competition when the government funds to the tune of billions of dollars any one particular technology,” he said.
Fellow panelist Albert Huddleston, Founder and CEO of Aethon Energy, offered another view, saying regulation is not necessarily excessive but can be misapplied. He emphasized the importance of environmental standards while acknowledging industry frustration.
“I don’t say there’s too much regulation. I think it’s misplaced,” Huddleston said, adding that clear benchmarks—rather than prescriptive oversight—could allow companies to meet environmental goals more efficiently.
Huddleston also raised national security concerns, warning that failing to build domestic data infrastructure could leave the United States reliant on foreign competitors. “You’d better make your own data,” he said, adding, “I don’t want our data … going through other countries.”
The debate over regulation comes amid broader tensions surrounding AI policy. A proposed federal moratorium that would have limited state-level AI regulation was defeated in a 99-1 Senate vote in 2025 after opposition from state officials and advocacy groups, according to previous reporting by The Dallas Express.
Meanwhile, the rapid buildout of data centers has sparked local concerns in Texas. Residents and agricultural officials have raised alarms about water use and land impacts associated with large-scale projects, particularly in rural areas dependent on groundwater, as DX previously reported.
Those competing pressures—economic growth, infrastructure demands, environmental concerns, and regulatory policy—are converging as AI reshapes both the labor market and the energy sector.
Panelists at EarthX agreed that demand for electricity from AI and digital infrastructure will continue rising sharply. The central question, as framed by the discussion, is whether policy frameworks can keep pace without slowing development.
Christian argued that current policies are falling short. “In every situation, it’s the government that’s interfering with the free market that’s harming American energy capacity,” he said.
