Texas launches new investigation into Houston's power utility following deadly outages after Beryl

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Texas' attorney general launched an investigation Monday into Houston's electric utility over allegations of fraud and waste following Hurricane Beryl, adding to the mounting scrutiny after widespread power outages left millions without electricity for days.

The latest investigation of CenterPoint Energy comes after state regulators and Republican Gov. Greg Abbott have also demanded answers about storm preparations and the response to Beryl, a Category 1 hurricane that knocked out power to nearly 3 million people around the nation’s fourth-largest city.

The storm was blamed for at least three dozen deaths, including those of some residents who died in homes that were left without air conditioning in sweltering heat after the storm's passage.

“My office is aware of concerning allegations regarding CenterPoint and how its conduct affected readiness during Hurricane Beryl,” Ken Paxton, the state's Republican attorney general, said in a statement. “If the investigation uncovers unlawful activity, that activity will be met with the full force of the law.”

The utility pledged its support of the investigation.

“We look forward to cooperating with the Texas Attorney General or any other agency and have made clear our commitment to upholding the values of our company,” CenterPoint spokesperson John Sousa said.

Paxton did not cite any specific allegations of waste or fraud in his announcement and his office did not respond to requests for comment.

Abbott has demanded answers from CenterPoint for what he called its slow restoration efforts and poor communication with customers in the days leading up to the storm. The state's Public Utility Commission has launched its own investigation, and lawmakers grilled the company’s top executive over its failures at a hearing last month.

CenterPoint has largely defended its storm preparedness and said that it deployed thousands of additional workers to help restore power. The utility provider has also begun a monthslong plan to replace hundreds of wooden utility poles and double its tree-trimming efforts after the governor pressed for swift action.

Beryl damaged power lines and uprooted trees when it made its Texas landfall on July 8. It’s the latest natural disaster to hit Houston after a powerful storm ripped through the area in May, leaving nearly 1 million people without power.

Many residents fear that chronic outages have become the norm after Texas’ power grid failed amid a deadly winter storm in 2021.

CenterPoint has previously faced questions over the reliability of Houston's power grid.

In 2008, Hurricane Ike, a Category 2 storm, knocked out power to more than 2 people million and it took 19 days to fully restore electricity. The city of Houston created a task force initiative to investigate the company's response and determined it needed to automate parts of its grid to minimize outages.

CenterPoint received millions of dollars in federal funding to implement this technology years ago. However, according to executive vice president Jason Ryan, it's still a work in progress.

Some utility experts and critics say the company hasn’t adapted its technology fast enough to meet the extreme weather conditions Texas will continue to face.

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It will take days to recover from Hurricane Beryl. Photo by Brandon Bell/Getty Images

Houston residents face high temperatures after storm Beryl leaves millions without power

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The return of searing heat in the Houston area has deepened the misery for people still without power after Hurricane Beryl left residents in search of places to cool off and fuel up as the extended outages strained one of the nation’s largest cities.

More than 1.7 million homes and businesses in Texas lacked electricity Wednesday morning, down from a peak of over 2.7 million on Monday, according to PowerOutage.us. State officials faced questions over whether the power utility that covers much of the area had sufficiently prepared.

Texas Lt. Gov. Dan Patrick said that a sports and event complex would be used to temporarily hold up to 250 hospital patients who are awaiting discharge but cannot be released to homes with no power.

Beryl, which made landfall in Texas early Monday as a Category 1 hurricane, has been blamed for at least seven U.S. deaths — one in Louisiana and six in Texas — and at least 11 in the Caribbean. It weakened as it moved deeper into the U.S. and early Wednesday was a post-tropical cyclone centered over northeastern Indiana.

A flood watch was in effect for parts of Illinois, Indiana, Michigan, New York, Vermont, New Hampshire and Maine. The storm spawned suspected tornadoes in parts of Indiana and Kentucky.

In the Houston area, Beryl compounded and repeated the misery of May, when storms killed eight people and left nearly 1 million without power.

High temperatures Tuesday climbed into the 90s (above 32.2 Celsius) with humidity that made it feel even hotter. Similar heat and humidity were expected Wednesday. The National Weather Service described the conditions as potentially dangerous, given the lack of power and air conditioning.

People coped as best they could. Kyuta Allen took her family to a Houston community center to cool down and use the internet.

“During the day you can have the doors open, but at night you’ve got to board up and lock up — lock yourself like into a sauna,” she said.

An executive for CenterPoint Energy, which covers much of the Houston area, defended the utility’s preparation and response.

“From my perspective, to have a storm pass at 3 p.m. in the afternoon, have those crews come in in the late evening, and have everything ready by 5 a.m. to go out and get out and start the workforce is rather impressive, because we’re talking about thousands of crews,” said Brad Tutunjian, vice president of regulatory policy.

Nim Kidd, head of the state’s division of emergency management, stressed that restoring power was the top priority.

Patrick, who is acting as governor while Gov. Greg Abbott is overseas, said nursing homes and assisted living centers were the highest priority. Sixteen hospitals ran on generator power Tuesday morning, according to the Federal Emergency Management Agency.

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Houston nonprofit launches new energy education platform

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The Energy Education Foundation, a Houston-based nonprofit, will roll out a new app-based education platform just in time for back-to-school season.

Starting this fall, EEF will offer its new EnergyXP platform to students in middle schools and through community and education events across the country. The STEM-focused platform aims to boost exposure to oil and gas concepts and career paths, according to a release from the non-profit.

EnergyXP represents a fully redesigned, interactive version of the foundation's former Mobile Energy Learning Units, which now feature upgraded technology, enhanced curricula and app integration.

“EnergyXP marks the most recent development in our educational initiatives. We aim to inspire students nationwide to explore real-world energy concepts and careers,” Kristen Barley, executive director of the Energy Education Foundation, said in the release. “Our collaborative approach involves strong partnerships with educators, industry experts and local organizations to ensure that our programs are responsive to community needs. By prioritizing equitable access to quality STEM education, we can help build a more inclusive, future-ready energy workforce.”

The new platform offers 16 hands-on and digital STEM activities that introduce a variety of energy concepts through real-world applications while "showcasing the relevance of energy in everyday life," according to the release.

EEF will host two virtual sneak peeks of the platform on Aug. 7 and Aug. 8. Register here.

Enbridge's new Texas solar project to power Meta data centers

solar deal

Construction is underway on a new 600-megawatt solar project in Texas that will supply renewable energy to Meta Platforms Inc., the owner of Facebook, Instagram and other tech platforms.

Calgary-based Enbridge Inc., whose gas transmission and midstream operations are based in Houston, announced that Meta has agreed to purchase 100 percent of the power generated by its new $900 million solar project known as Clear Fork.

The clean energy developed at Clear Fork will be used to support Meta’s data center operations, according to a news release from Enbridge. Meta has had net-zero emissions across its operational portfolio since 2020, according to its 2024 environmental report. The company matches 100 percent of its data center usage with renewable energy.

"We are thrilled to partner with Enbridge to bring new renewable energy to Texas and help support our operations with 100% clean energy, " Urvi Parekh, Head of Global Energy at Meta, said in a news release.

The Clear Fork project is expected to be operational by the summer of 2027. It will join Enbridge’s first solar power project in Texas, Orange Grove, which was activated earlier this year, as well as the company’s Sequoia solar project, which is scheduled to go online in early 2026.

"Clear Fork demonstrates the growing demand for renewable power across North America from blue-chip companies who are involved in technology and data center operations," Matthew Akman, executive vice president of corporate strategy and president of power at Enbridge, said in the news release. "Enbridge continues to advance its world-class renewables development portfolio using our financial strength, supply chain reach and construction expertise under a low-risk commercial model that delivers strong competitive returns."

Energy experts: Executive order enhances federal permitting for AI data centers

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In an effort to accelerate the development of artificial intelligence, President Trump signed an executive order (EO) aimed at expediting the federal permitting process for data centers, particularly those supporting AI inference, training, simulation, or synthetic data generation.

Following the White House’s issuance of a broader AI Action Plan, the EO seeks to streamline regulatory burdens and utilize federal resources to encourage the development of data centers supporting AI, as well as the physical components and energy infrastructure needed to construct and provide power to these data centers.

Qualifying Projects

The EO directs several federal agencies to take actions to incentivize the development of “Qualifying Projects,” which the EO defines as “Data Centers” and “Covered Component Projects.” The EO defines “Data Center Projects” as facilities that require over 100 megawatts (MW) of new load dedicated to AI inference, training, simulation, or synthetic data generation. The EO defines Covered Component Projects as materials, products, and infrastructure that are required to build Data Center Projects or upon which Data Center Projects depend, including energy infrastructure projects like transmission lines and substations, dispatchable base load energy sources like natural gas, geothermal, and nuclear used principally to power Data Center Projects, and semiconductors and related equipment. For eligibility as a Qualifying Project, the project sponsor must commit at least $500 million in capital expenditures. Data Center Projects and Covered Component Projects may also meet the definition of Qualifying Project if they protect national security or are otherwise designated as Qualifying Projects by the Secretary of Defense, Secretary of the Interior, Secretary of Commerce, or Secretary of Energy.

Streamlining Permitting of Qualifying Projects

The EO outlines the following strategies aimed at improving the efficiency of environmental reviews and permitting for Qualifying Projects:

NEPA Applicability: The Council on Environmental Quality (CEQ), in coordination with relevant agencies, is directed to utilize existing and new categorical exclusions under the National Environmental Policy Act (NEPA) to cover actions related to Qualifying Projects, which “normally do not have a significant effect on the human environment.” The EO states that where federal financial assistance represents less than 50 percent of total project costs of a Qualifying Project, the Project shall be presumed not to be a “major Federal action” requiring NEPA review.
FAST-41: The Executive Director of the Federal Permitting Improvement Steering Council (FPISC) is empowered to designate a Qualifying Project as a “transparency project” under the Fixing America’s Surface Transportation Act (FAST-41) and expedite its transition from a transparency project to a “covered project” under FAST-41. FPISC is directed to consider all available options to designate a Qualifying Project as a FAST-41 covered project, even where the Qualifying Project may not be eligible.
EPA Permitting: The US Environmental Protection Agency (EPA) is directed to modify applicable regulations under several environmental protection statutes impacting the development of Qualifying Projects on federal and non-federal lands. EPA is also directed to develop guidance to expedite environmental reviews for identification and reuse of Brownfield and Superfund Sites suitable for Qualifying Projects. Importantly, state environmental permitting agencies are not subject to the EO.
Corps Permitting: The US Army Corps of Engineers is directed to review the nationwide permits issued under Section 404 of the Clean Water Act and Section 10 of the Rivers and Harbors Act of 1899 to determine whether an activity-specific nationwide permit is needed to facilitate the efficient permitting of activities related to Qualifying Projects.
Interior Permitting: The US Department of the Interior is directed to consult with the US Department of Commerce regarding the streamlining of Endangered Species Act consultations for Qualifying Projects, and to work with the US Department of Energy to identify federal lands that may be available for use by Qualifying Projects and offer appropriate authorizations to project sponsors.

Federal Incentives for Qualifying Projects

The EO also directs the US Secretary of Commerce to “launch an initiative to provide financial support for Qualifying Projects,” which may include loans, grants, tax incentives, and offtake agreements. The EO further directs all “relevant agencies” to identify and submit to the White House Office of Office of Science and Technology Policy any relevant existing financial support that can be used to assist Qualifying Projects, consistent with the protection of national security.

The EO reinforces the Trump administration’s focus on AI and creates new opportunities for both AI data center developers and energy infrastructure companies providing power or project components to these data centers. Proactive engagement with relevant agencies will be crucial for capitalizing on the opportunities created by this EO and the broader AI Action Plan. By leveraging these financial and environmental incentives, project developers may be able to shorten permitting timelines, reduce costs, and take advantage of federal financial support.

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Jason B. Hutt, Taylor M. Stuart and Anouk Nouet are lawyers at Bracewell. Hutt is chair of the firm’s environment, lands and resources department. Stuart counsels energy, infrastructure, and industrial clients on matters involving environmental and natural resources law and policy. Nouet advises clients on litigation, enforcement and project development matters with a focus on complex environmental and natural resources law and policy.

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