On September 23, two administrative law judges at the Public Utility Commission told El Paso Electric that its proposed 366 MW gas plant for Meta can be built, but only if the people who live in El Paso do not pay for it. That is a ruling about one plant in one city. It is also the cleanest statement yet of the question every Texas data center deal now has to answer: when the power is built for one customer, who holds the bill?

This week's other deals each answer it differently. Crusoe plugged a Google campus straight into a wind farm and let the grid take the leftovers. Cipher Digital doubled the life of a lease and put a number on how it shares overruns. And two developers pitched gas that never touches ERCOT at all, which is the cheapest way to avoid the question.

The Judges Found No RFP, No Alternatives, and a Five-Year Bridge

El Paso Electric wants a Certificate of Convenience and Necessity for the McCloud Generation Facility, 366 MW of gas built from 813 modular generators of 450 kW each, supplied by Enchanted Rock at Meta's recommendation. The load is Meta's roughly 1 GW data center in El Paso. The judges found that the utility "failed to adequately consider alternatives to the gas plant" and "failed to issue a request for proposals to contractors." Fair summary: the utility picked the plant the customer suggested and then asked the state to certify the choice.

The condition is the headline. Per KVIA's reporting on the proposal for decision, the facility "may be approved only with protections intended to prevent EPE customers, other than Meta's data center, from paying the plant's construction and operating costs." Without those protections, the judges would recommend denial. The cost is itself a moving target. Inside Climate News puts it near $499 million, the city of El Paso has used $551.8 million, and I could not confirm which figure is current. Plan on roughly half a billion dollars either way.

Meta covers the costs for the first five years. The judges' concern is the sixth, when the bridge ends and the question of who pays becomes a ratepayer question. On September 28 the El Paso City Council authorized the city attorney and city manager to keep negotiating what it calls a "full hold harmless." The Commission's decision is expected by December 7. No open meeting date is set, and I could not confirm the docket number, so treat both as open. A five-year bridge on a plant with a multi-decade life is the kind of arrangement that sounds protective until you read the sixth year.

Crusoe Names Google, and the Power Plant Is a Wind Farm

Crusoe confirmed on September 28 that Google is the customer for its Armstrong County campus, per DataCenterDynamics. The site at 10001 Lima Road is planned as at least six single-story buildings: four of 805,380 square feet and two of 484,955. Crusoe's release says ground broke in June 2025 and more than 5,500 workers are on site daily.

The power structure is the interesting part. The campus connects directly to Serena's Goodnight 1 wind farm, 265.5 MW and operating, and Goodnight 2, another 265.5 MW under construction. That is 531 MW of generation sitting behind the fence, with surplus injected into the grid when the wind outruns the campus. It inverts the McCloud problem. Nobody is asking El Paso-style ratepayers to underwrite a plant, because the plant is a wind farm that already exists. The cost is variability, and Google gets to find out what a hyperscale load looks like on a Panhandle wind profile. The $29 billion investment figure floating around comes from Aterio Research as cited by DataCenterDynamics, not from Crusoe, so read it as an estimate.

Cipher Doubles Barber Lake to 20 Years and Writes the Overrun Rule Into the Lease

On September 25 Cipher Digital announced it had extended Barber Lake's contracted life from 10 years to 20. The second ten years is a binding commitment from an unnamed "leading AI lab" alongside existing tenant Fluidstack. Contracted revenue goes from $3.8 billion to over $9 billion, with about $5.2 billion of that new.

The less glamorous paragraph is the better one. Cipher bears the first $359.3 million of costs above the initial budget. Above that, the tenant reimburses 50 percent, structured as additional rent over the 20 years with a contracted rate of return. That is a cost-overrun clause in a press release, which is rare, and it answers the McCloud question in private-contract form: the party that wants the capacity shares the risk of building it. Delivery runs from the fourth quarter of 2026 into the first quarter of 2027, with first rent expected in the fourth quarter. The release names no megawatts, which in this market is a choice, not an oversight.

Off-Grid Gas: 450 MW Ordered, and a Brewster County Ranch Pitched

Enerflex announced October 1 that it was awarded about 450 MW of behind-the-meter gas-fired generation for an unnamed North American data center developer. Deliveries start in 2027 and the work completes in 2028. Enerflex plans about $15 million of 2026 spending, with roughly $85 million for energy services facilities, mostly in 2027, and says its opportunity pipeline exceeds 2 GW. CEO Paul Mahoney cited demand for "reliable, prime power that does not require grid connection." The release names no site and no state, so I am not calling this a Texas project. It is a Texas-relevant data point because Texas is where developers are hunting for exactly this equipment.

Closer to home, Pacifico Energy, the developer behind what public radio reporting ties to Amazon's Pecos County data center, has been talking to Brewster County officials about an AI campus with a gas plant on 8,400 acres northeast of Alpine. The company's own estimate runs from $5 billion to $60 billion, a range wide enough to cover a rounding error or a small country. The design is off-grid gas turbines with some solar and batteries, one to two years of planning before construction, and Kiewit among firms potentially in the mix for construction management. About ten residents showed up and none spoke in favor, citing air quality, noise and dark skies.

Put the two next to each other and the pattern from last week holds. The TCEQ air-permit halt means an island-mode campus still has to ask someone for permission. The ones that skip ERCOT have simply picked a different regulator, and that regulator is currently not issuing permits.

What to Watch Next Week

McCloud exceptions and the PUCT calendar. Watch for exceptions to the proposal for decision and whether El Paso Electric and the city land a hold-harmless agreement before the December 7 decision date. I could not confirm an exceptions deadline.

October 6, the SB6 large load curtailment workshop. This is where the question of who gets cut first in a shortage starts getting answered, and it matters more to behind-the-meter campuses than the McCloud docket does.

October 12, ERCOT's community impact RFI. Responses are due from developers of data centers of 25 MW or more. ERCOT has said it will work with the PUCT on a report by December 10. Watch for any extension or any disclosed response count.

October 15, the next PUCT open meeting, and October 19, TCEQ's compliance report. The first is the next chance for commissioners to say something about large-load metering or generation certificates. The second is the first look at how many island-mode projects the air-permit halt actually catches.

Disclaimer: The Grid Report is Barrio Energy's market intelligence product. Nothing here is investment advice, and Andi is not your broker. Links go to primary sources wherever possible; form your own view.