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Guadalupe County rejects Palomino Alpha development agreement amid water and power concerns
Summary
The Commissioners Court declined to approve a development agreement for a proposed Cloudburst AI data center and possible on‑site power plant after commissioners said they lacked sufficient detail on water demand, power sourcing and long‑term subdivision protections; motion failed (2 yeas, 2 nays, 1 abstention).
Guadalupe County commissioners declined to approve a development agreement with Palomino Alpha LLC on March 25 after sustained questioning about the project’s water use and electricity plans.
Commissioner 15, who announced an abstention because a portion of his property lies in the project boundary, said the agreement had been presented to the court as a data center but that the draft economic development agreement also contemplated a backup natural‑gas power plant. “I have read estimates that this thing will use 500,000 gallons a day of water,” Commissioner 15 said, adding that the county’s current water supplies and infrastructure make that a live concern for neighbors and for county services.
County staff told the court the development team described the data‑center cooling concept as a closed‑loop system that would recycle water and that LCRA was expected to supply primary electrical power. County counsel noted that any future power plant or facility would still be required to comply with county regulations and provide proof of water and other permits. “They still have to build it in accordance with county regulations as they stand right now,” county attorney (Mister Tynes) said.
Several commissioners said they were not opposed to the economic development potential but that key technical details were missing. Commissioners asked for specific, verifiable information on potable‑water use, discharge volumes and treatment, noise and lighting mitigations, and a clearer statement in the agreement about how future changes to county subdivision regulations would be handled.
The motion to approve the development agreement failed (2 yeas, 2 nays, 1 abstention). Commissioners who opposed the motion said they wanted more water‑use data and clarity about whether a power plant is part of the project and how any such plant would be permitted.
Next steps: Commissioners asked staff to obtain firm technical documentation from the developer on water sources and usage, power sourcing, environmental protections and binding language to limit future residential subdivision as the fallback use. If that material is provided to the court, the item could be reconsidered in a future meeting.
Votes and procedural note: The presiding judge announced the final tally as recorded on the March 25 docket; the judge abstained and the motion therefore did not carry.
