Brazoria County Rejects Tax Break for $3.5B Data Center

A massive data center and power plant project slated for rural Brazoria County hit a political speed bump this week, though it’s not likely to derail it.

County commissioners unanimously rejected a package of tax abatements sought by developer Nightpeak Energy for its proposed $3.5 billion Old Ocean Data Center campus outside Sweeny, about 65 miles southwest of Houston, according to Bisnow and first reported by the Brazoria County newspaper The Facts.

The project calls for two 310-megawatt hyperscale data centers paired with two 310-megawatt combustion turbine power plants on a 158-acre site. Each data center carries a projected price tag of roughly $1.5 billion, while the power plants would cost about $250 million apiece, according to meeting documents.

Oakland, California-based Nightpeak sought four separate 10-year, 100 percent property tax abatements tied to the development. Commissioners declined the incentives after residents and local officials raised concerns about noise, water consumption and power demand associated with the facilities.

Even so, the county’s vote doesn’t appear likely to stop the project.

“They’re probably going to do this project. I would bet you money they do this project, and we can’t do a damn thing about it,” Brazoria County Judge Matt Sebesta said during the meeting.

Under current plans, the Old Ocean Data Center campus would house hyperscale facilities serving cloud computing, data storage and colocation clients, or third parties that rent server space for their own servers and computer hardware equipment onsite. Construction is expected to generate several hundred jobs, with about 30 permanent positions once the project is operational, according to meeting documents.

The data center campus could begin energizing as soon as 2027, according to Nightpeak’s website. The nearby Bulldog Power combustion turbine facility has been in development since 2023 and is targeting operations in 2028 or earlier.

Local opposition partly stems from residents’ experiences with another data center in the area. County commissioner David Linder said a smaller facility that recently opened in nearby Brazoria has disrupted the lives of some constituents.

The clash reflects a growing national backlash against data center development, as artificial intelligence fuels a surge in demand for computing power — and the infrastructure required to support it.

Cities including Denver and Monterey Park, California, have proposed or enacted moratoriums on new data center construction. In Central Texas, Hays County commissioners recently debated a 30-day pause on development permits for large water users, including data centers, before county attorneys warned the move would likely trigger a lawsuit the county would lose.

— Eric Weilbacher