San Antonio leaders are considering novel regulations for data centers as the number of these facilities grows in the area. City Council members are focused on zoning rules and ensuring sufficient resources, particularly recycled water, are available.
Data Center Growth Sparks City Council Debate
The discussion began after Councilman Ric Galvan (D6) requested a review of data center development and resource use in San Antonio. Galvan expressed gratitude for feedback from District 6 residents, who live near the highest concentration of data centers in the city.
Council members explored a range of ideas, including community benefit agreements, encouraging tech job creation, and even having data centers share backup power with neighborhoods during outages. Galvan proposed updating San Antonio’s Unified Development Code (UDC) to categorize data centers as general industrial, noting that current zoning laws lack specific rules for these facilities.
Although the UDC is typically updated every five years—with the next update scheduled for 2027—Galvan and Mayor Gina Ortiz Jones advocated for an earlier review. Councilwoman Phyllis Viagran (D3) suggested waiting until 2027. Councilman Marc Whyte (D10) highlighted the potential economic benefits of data centers, including job creation and increased property tax revenue, suggesting the companies are willing to cover infrastructure costs.
Updating the UDC could allow the city to require data centers to be at least 1,000 feet from residential areas, parks, and other incompatible land uses, according to Amin Tohmaz, the city’s development services director.
Utilities Weigh In on Data Center Demand
San Antonio Water System (SAWS) officials acknowledge data centers present both risks and opportunities, relying on significant water and electricity while also generating revenue. CPS Energy is legally obligated to serve data centers that are paying customers, currently providing power to 21 facilities and generating $110 million in revenue through these contracts.
CPS Energy anticipates the energy needs of 59 planned projects to reach around 26,000 megawatts—enough to power roughly 250 homes per megawatt. The utility is piloting a program allowing data centers to develop on-site power generation, with a tariff applied to that power. CPS Energy’s president and CEO, Rudy Garza, indicated the utility may need to acquire additional power sources but believes it can meet demand for the next few years.
SAWS currently has the capacity to move around 30,000 acre-feet of recycled water, having provided almost 20,000 acre-feet last year. New data centers are planning to request approximately 600 acre-feet of drinking water and 3,000 acre-feet of recycled water. One acre-foot is enough water for roughly three houses annually.
Frequently Asked Questions
What is the Unified Development Code?
The Unified Development Code, or UDC, is San Antonio’s set of rules governing development. It is typically amended every five years, with the next update scheduled for 2027.
How much water do data centers currently use in San Antonio?
Today, data centers use around 0.1% of San Antonio Water System’s drinking water.
What is CPS Energy doing to address the growing energy demands of data centers?
CPS Energy is starting a pilot program that would let data centers develop on-site power generation, but requires a tariff be paid on that power. They also anticipate needing to acquire more power sources in the future.
As data center development continues, will San Antonio be able to balance economic growth with responsible resource management?
