Bernstein says Texas Gov. Abbott's data center audit will throttle new capacity approvals, boosting the value of existing BTC mining and AI sites with ERCOT-approved power.
Texas Governor Greg Abbott directed the Public Utility Commission of Texas (PUCT) and grid operator ERCOT on Aug. 4 to audit all data center projects currently in the state's interconnection queue. The order prompted ERCOT to pause its "Batch Zero" process, a review of the first group of large electricity users that had been scheduled to release classification results this month.
Data center requests currently make up roughly 90% of ERCOT's 474 GW interconnection queue. Analysts at Bernstein said in a note to clients on Aug. 4 that the audit will reduce the flow of newly approved power capacity, making existing approvals more valuable for Bitcoin (BTC) miners and AI operators already cleared to operate on the Texas grid.
Approved Capacity Is Not Affected
Bernstein said the review will likely delay select developers with pipeline assets still awaiting grid approval, but it will leave currently operating infrastructure untouched. "Within our coverage and broadly miners, all contracts under execution are for approved capacity and are not impacted by the audit," the analysts wrote.
The firm identified Cipher Digital (CIFR), CleanSpark (CLSK), and Core Scientific (CORZ) as having greater exposure to the order, as their near-term expansion plans depend on new Texas grid connectivity. All three still received "Outperform" ratings from Bernstein alongside Riot Platforms (RIOT), IREN, and Terawulf (WULF). Marathon Digital (MARA) received a "Market-perform" rating.
Scarcity Makes Approved Megawatts More Valuable
Terawulf, Riot Platforms, and IREN were highlighted as beneficiaries. Bernstein cited Terawulf's power portfolio spread across Kentucky, Maryland, and New York, and pointed to Riot and IREN's large operational footprints already approved by ERCOT. "We believe with increasing political opposition to new data center projects and fresh capacity being throttled by moratoriums and state directives, the approved MWs become more valuable," Bernstein wrote. "If MWs are scarce, it makes sense to earn more per MW."
Bernstein framed the audit as part of a broader shift in how Bitcoin miners are positioning themselves in the AI infrastructure market. Over the past two years, miners have contracted eight gigawatts of power capacity to hyperscalers, neoclouds, and AI chip manufacturers across more than 20 deals worth over $160 billion in total contracted value. The firm said AI infrastructure stocks with planned 30 GW power portfolios remain well positioned to deliver compute capacity on short timelines because of their ability to offer powered shell facilities ready for rapid deployment.
The Batch Zero pause adds regulatory uncertainty to a queue that was already under pressure. With Texas representing one of the most active power markets for large-scale compute development in the US, the outcome of the audit could reshape which projects advance and on what timeline.
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