When the Grid Says No: What Texas Data Centers Tell Us About Indiana's Infrastructure Future

Texas is heading into winter with a problem that should sound familiar to anyone watching Indiana's utility landscape.

The state's power grid is buckling under massive new data center projects. And existing customers? They're bracing for impact.

Here's what's happening: more than 220 gigawatts of projects have requested connection to the Texas grid as of November 2025 (a 170% increase over the 83 gigawatts of project requests back in January). About 73% of these projects requesting connection are data centers. CNBC

To put that in perspective, if all those projects actually got built, they'd consume electricity equivalent to 154 million homes. In a state with only 30 million people.

The parallels to Indiana's recent NIPSCO rate proceedings? Impossible to ignore.

The Pattern Playing Out Everywhere

You know that feeling when you see the same story unfolding in different places? That's what's happening here.

Texas suffered through Winter Storm Uri in 2021. More than 200 people died during widespread blackouts. The grid failed when people needed it most. And now? ERCOT has approved 7.5 gigawatts of new data center connections CNBC (roughly equivalent to the peak demand of greater Philadelphia's 1.7 million residents) while existing reliability concerns remain unresolved.

Here's what matters for Indiana manufacturers and commercial customers: the same dynamic is unfolding right here. Just with less dramatic headlines.

When utilities move at lightning speed to accommodate high-value customers like data centers while existing commercial ratepayers wait months for basic service improvements? That's not inefficiency. That's a choice about who matters and who pays.

The Question Nobody's Asking (But Should Be)

The Texas situation illuminates something critical: who pays for the infrastructure needed to serve new, massive electricity consumers?

Data centers require substantial grid upgrades. Transformers, transmission lines, substation capacity. All of it costs real money. Real money that gets allocated somewhere. And in Texas, the majority of power plants that went offline during Winter Storm Uri ran on natural gas CNBC, yet the state continues adding load faster than it can reliably serve existing customers during extreme conditions.

Indiana manufacturers facing cost escalation pressures should be paying attention. When utilities invest billions in infrastructure to serve new customers, those costs land somewhere. The pattern we've seen repeatedly in NIPSCO proceedings suggests that "somewhere" often means the existing commercial customer base.

(Not because it's fair. Because it's convenient.)

What Fast-Tracking Actually Means

There's a telling detail in the Texas story.

Beth Garza, former head of ERCOT's watchdog, called the scale of data center requests "crazy big." She noted that more than half the projects haven't even submitted planning studies CNBC, yet they're clogging the interconnection queue and forcing grid planning decisions.

Meanwhile, the manufacturers who've been reliably paying their electric bills for decades? The ones whose operations depend on stable, affordable power? They're not getting the red carpet treatment when they need service improvements or rate relief.

This mirrors exactly what we've documented in Indiana proceedings. Utilities have no trouble moving quickly when lucrative new customers come calling. But when existing commercial ratepayers request fair treatment in cost allocation, suddenly everything requires years of study and regulatory proceedings.

The Indiana Translation

Let's be clear: Indiana isn't facing Texas-level grid crisis. Our winter reliability concerns are different, our regulatory structure is different, and NIPSCO operates under different constraints than ERCOT.

But the fundamental dynamic? Identical.

Utilities prioritizing new, high-value customers while existing commercial ratepayers absorb infrastructure costs and face mounting rate pressures.

Consider what's happening here:

• NIPSCO seeks approval for massive infrastructure investments
• New customers requiring substantial service get connected
• Rate cases arrive, and commercial customers see bills climb
• Questions about fair cost allocation take a back seat to utility revenue requirements

The kinds of questions commercial ratepayers should be asking:

• What portion of infrastructure costs are directly attributable to serving specific new customers?
• How are those costs being allocated across rate classes?
• Why should existing customers subsidize infrastructure that primarily benefits new loads?
• What's the timeline for cost recovery, and who bears the risk if projected demand doesn't materialize?

These aren't abstract regulatory puzzles. They're questions with direct impacts on your operating margins, competitive positioning, and whether manufacturing remains economically viable in Indiana.

The Representation Gap (And Why It Matters)

Here's what the Texas situation makes crystal clear: these decisions happen whether commercial ratepayers show up or not.

Texas approved 7.5 gigawatts of new data center connections. Indiana utilities will continue pursuing their infrastructure plans. Rate cases will proceed. Cost allocations will be determined.

The only question is whether you have professional representation at the table when those decisions get made.

That's what we do at Fair Rates Alliance. We provide manufacturers and commercial customers with the same caliber of legal and regulatory expertise that utilities bring to every proceeding. Expert witnesses who understand cost allocation methodology. Attorneys who know how to challenge unfair rate structures. Regulatory advocates who can translate technical issues into clear arguments about fairness.

Because here's the reality: Indiana regulators need to hear from commercial ratepayers. Not just vague concerns about rates going up, but specific, expert-supported analysis of why particular cost allocations are unjust and what fair alternatives look like.

What Happens Next

Texas will navigate this winter. Grid operators will manage the new loads. Some combination of conservation, imports, and possibly curtailments will keep the lights on.

But the underlying question remains unresolved, in Texas and in Indiana: when utilities invest billions in infrastructure to serve new customers, how do we ensure existing ratepayers aren't left holding the bag?

That question gets answered in regulatory proceedings. With expert testimony. With detailed cost analysis. With sustained advocacy from people who understand both the technical details and the economic stakes.

The manufacturers and commercial customers who've built their operations in Indiana, who employ our workers and invest in our communities? You deserve fair treatment in utility rate cases. Not special treatment. Not subsidies. Just fair allocation of costs based on who benefits from the infrastructure being built.

That's what we do. And if the Texas situation tells us anything, it's that this work matters now more than ever.

Got questions about how data center development or other infrastructure projects might affect your facility's electric rates? Let's talk about what's actually happening in current NIPSCO proceedings and what it means for your bottom line.

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To read the full CNBC article, visit: www.cnbc.com/2025/11/22/texas-data-center-ai-ercot-blackout-power-outage.html