As Texas continues to attract energy-intensive industries like data centers, cryptocurrency mining, and advanced manufacturing, lawmakers are moving swiftly to ensure the state’s power grid remains reliable and resilient. Texas Senate Bill 6 (SB6), introduced by Sen. Phil King in early 2025, represents a comprehensive effort to regulate large electricity users amid projections that statewide power demand could nearly double by 2030.
Why SB6 Matters
Texas has seen explosive growth in demand for electricity, fueled by the influx of large-scale technology operations. While this trend brings economic benefits, it also places increasing strain on the state’s electric grid, managed by the Electric Reliability Council of Texas (ERCOT). SB6 is designed to manage that strain by creating a regulatory framework to ensure that large consumers contribute their fair share to infrastructure costs and grid stability.
Key Provisions of SB6
1. New Transmission Charges
SB6 mandates the Public Utility Commission of Texas (PUCT) to impose transmission charges on customers with behind-the-meter generation (e.g., on-site solar or backup generators). The goal is to ensure these users help fund the transmission system they still rely on during outages or peak demand.
2. Interconnection & Planning Requirements
To improve planning and reliability, the bill introduces:
- A minimum $100,000 fee for transmission screening studies.
- Financial security requirements before a project is formally reviewed.
- Disclosure of backup generation facilities to ERCOT, with conditions for mandatory use during emergencies.
3. Backup Generation & Emergency Response
Large facilities must:
- Register backup generators with local utilities.
- Participate in a voluntary program to reduce power usage during grid stress in exchange for compensation.
- Use on-site power generation or curtail consumption when ERCOT declares an emergency.
4. Improved Forecasting
SB6 tightens load forecasting protocols and requires large users to report power requests across projects. It also calls for a reassessment of existing programs like the “Four Coincident Peak” model to better reflect modern energy usage patterns.
Legislative Status & Industry Reaction
As of mid-June 2025, SB6 has passed the Texas Senate and is pending approval in the Texas House. Its passage would mark a significant shift in how the state regulates high-load electricity users and plans for future infrastructure needs. Supporters of SB6, including grid operators and consumer advocacy groups, praise the bill for addressing infrastructure fairness and enhancing grid reliability.
Critics, including some technology companies and crypto advocates, argue that the bill could create barriers to entry and stifle investment in Texas—a state that has marketed itself as a haven for energy innovation and deregulation.
Looking Ahead
SB6 underscores a broader transformation in how Texas balances economic growth with infrastructure sustainability. If passed, it will serve as a national model for integrating energy-intensive technologies into legacy power systems without compromising reliability or shifting costs to residential consumers.