Texas: Broad Reach

By Anne Cosgrove
From the May / June 2024 Issue

Fueled by 55 Fortune 500 companies, a skilled and diverse workforce of more than 15 million, and thousands of businesses large, small, and in-between, the Texas economy continues to grow and diversify.

In 2023, Texas attracted investments from a variety of industries, including electric vehicles, semiconductors, corporate headquarters, and data centers—activity that has continued in 2024. The state’s largest industries, by revenue, in 2023 were: gasoline & petroleum wholesaling ($298.1 billion); oil drilling & gas extraction and petroleum refining ($210.9 billion); and petroleum refining ($170.2 billion).

In 2023, Texas’s economy grew faster than the U.S. overall, with a real GDP growth rate of 5.7% for the year, compared to 2.5% for the rest of the nation. In the third quarter of 2023, Texas’s real GDP was $2.5 trillion, with a growth rate of 7.7%. Job growth over the past 12 months totaled 306,000 jobs added from April 2023 to April 2024.

Signed into law in July 2023, the state’s new Jobs, Energy, Technology & Innovation (JETI) Act (or, House Bill 5) created the new 403 incentive program. This replaced the expired Texas Economic Development Act (known as Chapter 313), which had been in place from 2001.

The JETI Act provides for tax abatements and other incentives for large-scale business developments, expansions, and relocations in Texas. The program began accepting applications in January, offering companies the opportunity to secure significant property tax breaks for large-scale projects such as manufacturing facilities.

Also passed during the 88th legislative session in 2023, the Texas CHIPS Act was enacted to build upon opportunities available through the federal CHIPS and Science Act. The Texas CHIPS Act has created the Texas Semiconductor Innovation Consortium (TSIC) and Texas Semiconductor Innovation Fund (TSIF), both administered by the Texas CHIPS Office, a division within the Economic Development & Tourism office.

Investments Across The State

In April, Edged Energy announced it will build a sustainable data center in Irving, TX, a significant addition to the Dallas-Fort Worth region. Known as Edged Dallas, the facility will be built for high-density AI workloads and utilize waterless cooling and ultra-efficient energy systems. Edged has nearly a dozen new data centers operating or under construction across Europe and North America and a gigawatt-scale project pipeline.

“Sustainability is at the core of our platform. It is why our data centers are uniquely optimized for energy efficiency and water conservation,” said Bryant Farland, Chief Executive Officer for Edged. “We are excited to be partnering with the Irving Economic Development Partnership (IEDP) and City of Irving, a thriving tech hub that shares our commitment to innovation and advancing technology for positive impact. Together, we are delivering world-class connectivity and future-proof solutions to support the region’s booming digital economy.”

Edged Dallas will be outfitted with the ThermalWorks waterless cooling system, designed to support the intense demands of generative AI and advanced computing. Unlike other waterless cooling solutions, this advanced technology is ultra-efficient, which helps Edged dramatically reduce energy overhead by 74% compared with the global average PUE of 1.58 reported by the Uptime Institute.

Edged Dallas, LLC, a subsidiary of Endeavour, joins a growing network of Edged data centers under construction across the U.S., including in Atlanta, Chicago and Kansas City. The facility is expected to open later this Fall.

North of Austin, the semiconductor ecosystem will get a boost with a planned $100 million expansion of MGC Pure Chemicals (MPCA) in Killeen, TX. The investment will double the current capacity of the facility for the company that produces chemical materials for the semiconductor industry.

“We are pleased to continue our growth in Killeen with these investments”, said Lee M. Bauer, general manager with MPCA. “The growth of our customers in the semiconductor industry in the United States is driving the need for us to add new capacity. We appreciate the support from the City of Killeen and Killeen Economic Development Corporation throughout the process to get us to this announcement.”

Distribution facilities have announced expansions in recent months:

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• In Laredo, the new AEP Texas Laredo Service Center represents a $35 million capital investment. Also in Laredo, Ryder System, Inc. opened a new logistics operation, and expanded its drayage yard in Nuevo Laredo, Mexico.
• In San Angelo, Amazon announced plans to expand its investment in Texas by opening a new last-mile facility there.

In other investment around the state:

• Hydroflo Pumps USA, a manufacturer of vertical and submersible turbine pumps, will expand in Lubbock with 38 new jobs and more than $1.8 million in capital investment.
• Petrosmith, an oil and gas production equipment manufacturer, will expand its operations in Abilene with a $25 million capital investment and the creation of 250 skilled jobs.
• Accelerated Solutions Group unveiled its new facility in Tomball, which is expected to create 50 new jobs for the community.

Check out all the latest news related to Texas economic development, corporate relocation, corporate expansion and site selection.