Texas Utility Backs Abbott's Data Center Queue Pause, Says Amazon Nuclear Deal Unaffected

Vistra Corp, the biggest power generator in Texas, told Wall Street on Friday it backs a pause on new data center hookups in the state while regulators sort out which projects in line are actually real.

CEO Jim Burke didn't mince words on the company's second-quarter earnings call. "I'd like to see the queues culled, at the end of the day," he said, referring to the backlog of proposed data center projects waiting for grid connections through the Electric Reliability Council of Texas.

Governor Greg Abbott has pushed for an audit of that interconnection queue, according to Utility Dive. The concern, shared across the industry, is that speculative projects are clogging the line, making it harder for utilities and grid planners to figure out how much real demand is coming and when.

If half the megawatts in a queue belong to developers who never break ground, utilities end up planning generation and transmission for phantom load. Vistra, PPL, and grid operators nationwide have flagged this same issue as data center and AI-driven demand explodes.

Comanche Peak deal stays on track

Vistra executives said they don't expect the Texas pause to touch the company's marquee deal: a 20-year power purchase agreement to supply Amazon's data center near Vistra's Comanche Peak nuclear plant. Amazon is building a $5 billion data center campus there, and the 2.4-GW plant is set to start delivering power to Amazon in 2027.

"We don't see [Comanche Peak] being affected at this point, and we support the conversation that the governor is wanting to have with the data center community to make sure that Texas does this right," Burke said.

His reasoning: nuclear and other baseload projects have already been through rigorous study, so they're not the ones the audit is targeting. "We haven't gotten any signals that folks in Austin see the baseload projects at this point as being materially off on time frame," Burke said.

Vistra CFO Kris Moldovan reported adjusted EBITDA of $1.767 billion for the quarter, up 30% year-over-year. The generation segment alone brought in roughly $994 million, up from $593 million a year earlier, driven largely by hedging strategy that pushed average realized power prices about 5% higher per megawatt-hour compared with last year.

Chief Strategy Officer Stacey Doré said Vistra is negotiating with data center customers across both ERCOT and the PJM Interconnection, the mid-Atlantic grid operator. "Customers don't need perfect clarity in order to contract," she said, even as regulatory uncertainty persists in both markets.

PPL and Blackstone lock down turbines in Pennsylvania

The same supply crunch is playing out in Pennsylvania, where PPL Corp's joint venture with Blackstone Infrastructure, called Invitium Energy, has secured reservation agreements for more than 5 GW of combined-cycle gas turbines, according to PPL CEO Vincent Sorgi.

Sorgi said Invitium expects to announce at least one deal this year to supply a data center directly. The venture has identified sites that could eventually support up to 14 GW of new generation, representing as much as $15 billion in investment through 2032. PPL holds a 51% stake.

Sorgi doesn't expect meaningful earnings from Invitium until the turbines actually come online, which could be as early as 2031. He noted PJM plans a backstop reliability auction in late September, but predicted bilateral contracts, not the auction, will be the main way new generation gets built.

PPL's data center pipeline in its home territory grew 12% to 31.8 GW in the second quarter. In Kentucky, the company's utilities have an 11.6 GW data center pipeline and now project 3.7 GW of new load will be online by 2032, more than double last year's estimate.

The bottleneck: turbines themselves

None of this build-out happens without hardware, and that's where Siemens Energy comes in. The German manufacturer's gas services backlog hit 69 GW as of its fiscal third quarter, after booking 15 GW in new orders in a single quarter. Sales in that division jumped 62% year-over-year to €10 billion ($11.6 billion).

CFO Maria Ferraro said lead times for turbines now run three years or more. CEO Christian Bruch said the global addressable market for gas turbines could hit 120 GW a year, with roughly half that demand coming from the United States, driven overwhelmingly by data centers.

Siemens has brought about 30 additional units of medium-turbine manufacturing capacity online since 2025 and plans to expand large-turbine capacity by 15 units in 2027, pushing medium-turbine capacity to about 100 units by 2028.

Texas can audit its queue and Pennsylvania can lock down turbine reservations, but the actual constraint on how fast America's grid can handle the AI data center boom now sits with a handful of manufacturers, Siemens chief among them, who are already sold out three years ahead.