Texas Law Firms Face Conflicts as Data Center Boom Surges

Major utilities are top clients for leading Texas law firms now representing data center developers

Mar. 17, 2026 at 9:00am

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The rapid growth of data centers in Texas is creating conflicts of interest for major law firms in the state that represent both large regulated utilities and the AI and hyperscale companies building multibillion-dollar data facilities that require massive amounts of electricity from the power grid.

Why it matters

As the data center industry expands, law firms must navigate complex ethical issues and potential conflicts of interest when representing both utility companies and the data center developers that rely on those utilities for power. This could impact how these firms advise clients and handle sensitive information.

The details

Three of the largest law firms in Texas—Vinson & Elkins, Baker Botts, and Jackson Walker—are go-to advisers for major regulated utilities like Oncor Electric Delivery, CenterPoint Energy, and Texas-New Mexico Power. These same firms are now representing AI data center developers and hyperscalers building multibillion-dollar facilities that require massive amounts of electricity from the state's power grid.

  • The data center boom in Texas is currently underway.

The players

Vinson & Elkins

A large law firm in Texas that advises major utility companies and is now also representing data center developers.

Baker Botts

A large law firm in Texas that advises major utility companies and is now also representing data center developers.

Jackson Walker

A large law firm in Texas that advises major utility companies and is now also representing data center developers.

Oncor Electric Delivery Co.

A large regulated utility company in Texas that is a top client of the law firms.

CenterPoint Energy

A large regulated utility company in Texas that is a top client of the law firms.

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What they’re saying

“There's a whole host of conflicts that can result.”

— John Browning, Former appeals court judge in Dallas (Bloomberg Law)

What’s next

Law firms will need to carefully manage potential conflicts of interest as the data center industry continues to grow rapidly in Texas.

The takeaway

The data center boom in Texas is creating complex ethical challenges for major law firms that must balance representing both utility companies and the data center developers that rely on those utilities, underscoring the need for robust conflict of interest policies in the legal industry.