Media Type: Article

By Jonathan R. Rotzien

Texas is rapidly emerging as one of the largest and fastest-growing data center markets inthe United States, driven by energy availability, competitive energy pricing, abundant land,and robust infrastructure investments.

Cindy A. Yeilding coined the term “The Explorer’s Mindset” in her 2002 AAPG Distinguished Lecture. As Mark Shann would say, “You need to call it something to be able to define it,” in his reference to “disruptive discoveries,” like Zama, the discoveries that abruptly change the resource curves in relatively mature basins. So how is “The Explorer’s Mindset” defined?

Standing on the shoreline, facing south. It’s a perfect December day on the chromite-cobbled beaches of Limassol, Cyprus. Mostly sunny, light breeze from the west. Tuned 5 degrees east of north for the local declination, the Brunton bearing reads 205 degrees toward Zohr. Zohr, the approximately 450 million- barrels-of-oil-equivalent gas giant, is about 175 kilometers southwest of where I’m standing.

On December 11, 2025, the EPA’s Office of Air and Radiation launched a new resource page consolidating Clean Air Act guidance for data center developers. The resource is part of the Trump administration’s broader effort to accelerate energy infrastructure development and reflects the growing recognition that air permitting has become a critical bottleneck for AI and data center projects.

Data centers, domestic manufacturing, and other drivers of economic growth are generating significant new demand for electricity across the country. Grid operators are working to ensure that new generation capacity keeps pace. In PJM Interconnection—the nation’s largest grid operator—the December 2025 capacity auction fell 5.2% short of reliability requirements for the 2027-2028 delivery year, the first time PJM has experienced such a shortfall. Capacity auctions are a mechanism used in some regions for ensuring enough generation exists to meet projected demand. PJM’s shortfall has prompted two new proposals for how to accelerate new generation.

On December 19, 2025, the IRS issued Notice 2026-1, providing a safe harbor for taxpayers seeking to claim the federal income tax credit for qualified carbon oxide sequestration under section 45Q of the Internal Revenue Code of 1986, as amended (the “Code”). The Notice addresses a compliance gap created by the Environmental Protection Agency’s (“EPA”) proposed repeal of greenhouse gas reporting requirements that are currently necessary to claim the credit.

Fossil fuels will meet a significant portion of global energy needs through mid-century, say public and private forecasts

The goal of this white paper is to inform discussions and actions related to the EU Methane Emissions Regulation (EU MER) and global gas natural gas supply chains. The analysis takes no position on the EU MER itself, in whole or in part. Starting in mid-2025, researchers and staff affiliated with the Center for Energy and Environmental Systems Analysis (CEESA) have engaged with U.S. and international stakeholders in the development of a verification and reporting protocol for the EU MER. Ahead of the release of the protocol, this white paper identifies potential actions to reduce ambiguity over how the EU MER will be implemented.

Applications for the new Kay Bailey Hutchison Computational Energy Fellowship opened Jan. 5. Selected students will train to improve the safety and efficiency of energy systems in Texas and nationwide.