Trump heads toward unlikely clash with close ally over future of multibillion-dollar industry

DALLAS — The artificial intelligence boom is fueling a data center rush in Texas and opening a rare divide between President Donald Trump and one of his closest political allies — Republican Gov.

Greg Abbott.

Projects bringing billions of dollars in investment to Texas also create enormous demand for electricity, raising questions over who will be on the hook to pay for potential power grid impacts.

Abbott has moved to address those concerns, directing regulators to ensure data centers cover the infrastructure costs needed to serve them and calling on developers to add their own power generation rather than shift costs onto Texas residents.

Trump isn't happy with Abbott's approach and called the Lone Star State's stance toward data centers a "mistake," pointing to the economic investment the projects can bring to communities willing to host them.

TEXAS GOV.

ABBOTT EFFECTIVELY PAUSES NEW DATA CENTER PROJECTS PENDING STATEWIDE GRID AUDIT The president has made energy dominance and U.S. leadership in artificial intelligence central pillars of his second term.

"For Texas to say no to data centers is a mistake in the sense that it could be bigger than oil," Trump told Punchbowl News in an interview published Friday.

"Data centers could be bigger than oil," he predicted.

Texas has become a focal point of that debate as soaring demand for the computing power behind artificial intelligence and cloud services drives a wave of data center development across the state.

Neither the White House nor Abbott's office responded to Fox News Digital's request for comment on the departure between the two on data centers.

Dallas now ranks as the world’s No.

1 primary data center market, according to Cushman & Wakefield’s 2026 Global Data Center Market Comparison .

The ranking underscores the Lone Star State's rapid rise as companies seek the land and electricity needed to support artificial intelligence.