Most counties in Texas and New Mexico allow solar co-location for data centers, typically governed by specific land-use ordinances, special use permits (SUPs), or industrial zoning. In Texas, counties like Pecos, Reeves, and Milam have become leaders in integrated energy projects. In New Mexico, Lea and Eddy counties offer favorable regulatory environments for "behind-the-meter" solar. These jurisdictions prioritize co-location to reduce grid strain and accelerate the deployment of high-performance computing (HPC) facilities.
Understanding Solar Co-location for AI Infrastructure
Solar co-location involves placing a photovoltaic (PV) array on the same site, or adjacent to, a data center facility. For the AI industry, this is increasingly viewed as a necessity rather than an amenity. As hyperscale requirements push toward the gigawatt scale, the traditional "grid-first" approach often faces multi-year delays in interconnection queues.
By co-locating solar, developers can implement a "behind-the-meter" strategy. This allows the data center to pull power directly from the solar field, reducing the immediate load required from the local utility and lowering transmission costs. According to the National Renewable Energy Laboratory (NREL), co-location can also provide a hedge against volatile energy prices while meeting corporate sustainability mandates.
Key Counties and Regions for Co-location
While state-level policies set the framework, the actual "allowance" for solar co-location happens at the county level through zoning and tax abatement agreements.
Texas (ERCOT and SPP Regions)
Texas is the national leader in solar co-location due to its deregulated energy market and the Chapter 312 and 313 tax incentives (and their successors) that encourage large-scale capital investment.
Pecos and Reeves Counties: These West Texas counties have some of the highest solar irradiance in the country and established pathways for industrial energy permits.
Milam County: Located near the "Texas Triangle," this area has seen significant interest in converting former industrial sites into solar-powered data hubs.
New Mexico
New Mexico’s Renewable Energy Act and its vast stretches of state and private land make it a prime candidate for integrated infrastructure.
Lea and Eddy Counties: Traditionally energy-heavy regions, these counties are pivoting toward diversified portfolios. Their local governments are experienced in permitting complex, multi-use energy projects.
Bernalillo and Santa Fe Counties: While more restrictive, these areas allow co-location through specific "Planned Development" zones that integrate aesthetic and environmental standards.
Navigating the Regulatory Landscape
Determining if a county allows solar co-location is only the first step. Developers must undergo a rigorous environmental review for data center projects to ensure the land can support both the heavy electrical infrastructure and the sprawling footprint of a solar array.
In many rural counties, the primary hurdle is not a prohibition of solar, but rather the capacity of local infrastructure to handle the construction phase. This includes road access, water for dust mitigation, and the sheer acreage required. When planning these sites, developers must also consider how much land for noise mitigation datacenter operations is needed, as solar arrays can act as a natural buffer between high-density compute clusters and neighboring properties.
Why Co-location is the Future of the "Infrastructure Brief"
The shift toward co-location is driven by the complete guide ai data center infrastructure requirements of 2026 and beyond. AI workloads require constant, high-density power. While solar is intermittent, combining it with on-site battery storage or firming it with natural gas generation allows for a "hybrid" microgrid that can operate independently of the main grid during peak demand periods.
KizerAI is currently positioning itself at the center of this transition. With approximately 500,000 acres of strategic land holdings across New Mexico and Texas, the platform has identified up to 5 gigawatts of potential power development. By controlling the land and the energy resource simultaneously, KizerAI streamlines the path for hyperscalers who need to bypass traditional utility bottlenecks.
KizerAI is developing large-scale AI, data center and energy infrastructure across strategically positioned land holdings. Get involved →