Curtailment Risk in Texas: Why Data Centers Need Behind-the-Meter Power Solutions

DPS
Sep 21
3 min read

Curtailment Risk in Texas: Why Data Centers Need Behind-the-Meter Power Solutions

Texas has quickly become a global hub for hyperscale and colocation data centers, thanks to its low-cost energy and expansive land availability. But the state just set a precedent that is sending shockwaves through the industry: ERCOT now has the authority to curtail large data centers during grid emergencies.

According to Utility Dive, Texas Senate Bill 6 (SB-6) grants grid operators the power to disconnect or reduce consumption of facilities above 75 MW. For data centers built on grid reliability, this is a game-changer.

At Data Power Supply, we view this as the clearest signal yet: grid power is no longer guaranteed, diesel is unsustainable, and behind-the-meter (BTM) solutions are mission-critical.

The Curtailment Challenge

The precedent in Texas is only the beginning. As AP News reports, other states are already considering similar curtailment measures in the face of explosive data center growth. That means operators nationwide must prepare for three converging realities:

Grid power not guaranteed – ERCOT and other ISOs now hold the authority to disconnect or limit data center usage in a crisis.
Diesel backup is unsustainable – Diesel generators may keep lights on temporarily, but they fail long-term tests of fuel volatility, carbon compliance, and scalability.
BTM independence is mandatory – The only way to guarantee uptime is to own your power strategy.

Why Natural Gas & RNG Microgrids Are Winning

Industry leaders are already pivoting. Microgrid Knowledge highlighted the VoltaGrid–Vantage Data Centers partnership, deploying over 1 GW of gas-fired microgrid capacity. This represents a fundamental shift: data centers aren’t waiting for the grid—they’re building their own power foundations.

NGI reports that many developers are now exploring off-grid and behind-the-meter gas and RNG generation, bypassing costly interconnections while delivering scalable, resilient power.

And according to Microgrid Knowledge, the momentum is much broader: microgrids are no longer niche. They are becoming the inevitable solution for reliability, modular growth, and environmental commitments.

The Data Power Supply Advantage

At Data Power Supply, we deliver more than just reliable energy—we deliver end-to-end infrastructure solutions that combine power, scalability, and flexibility:

BTM Power Infrastructure – Scalable natural gas and RNG microgrids, purpose-built for mission-critical facilities.
Customizable Modular Data Center Pods – Deployable, pre-engineered pods for hyperscale, edge computing, and crypto mining applications. These pods can be rapidly deployed anywhere power is available, reducing time-to-market and capital risk.
Crypto Mining Pods – Designed for efficiency and resiliency, powered directly by our natural gas and RNG microgrids, making mining operations both cost-competitive and environmentally sustainable.
Long-Term Fuel Supply – Competitive 15- to 30-year contracts that lock in stable $/kWh pricing and insulate operators from market volatility.
Hybrid Integration – Systems designed to integrate natural gas, RNG, solar, and storage for both uptime and ESG compliance.
Tier III+ Redundancy – Architected to meet hyperscale standards, ensuring mission-critical workloads never go offline.

Why Act Now

The warning signs are clear:

Texas already has laws in place to force curtailment during emergencies.
Other states are considering similar actions.
Diesel is under increasing pressure from regulators and ESG mandates.
Modular pods paired with microgrids are proving to be a faster, safer, and more scalable model for data growth and crypto operations.

Data centers that fail to adapt will find themselves exposed. The ones that thrive will be those that embrace behind-the-meter independence and modular flexibility today, not tomorrow.

Partner with Data Power Supply

At Data Power Supply, we don’t just sell power—we deliver complete solutions for hyperscale, colocation, and crypto operators.

We help you: