By Russell Slaton
russell@themonitor.net

NEAR TRINIDAD-More than a thousand acres that lies between State Highway 274 and Key Ranch Road north of Trinidad has become ground zero for a battle between the Cedar Creek Lake community and a Kansas City-area data center developer, with questions raised about a data center’s effect on residents’ quality of life, along with worries about the how much water might be drawn from the lake to service it, as well as bigger questions about the future of other resources that sustain the area.
Rumors of a Trinidad-area data center cropped up earlier this year, then came to the forefront May 21 when a water authority near the Key Ranch Estates and Lakewood subdivisions area that fronts the property in question, West Cedar Creek Municipal Utility District, at its board of directors’ meeting temporarily suspended high-capacity water sales through April 2027, saying it needs to study whether its system can handle another high-volume customer.
West Cedar Creek MUD has a right to a portion of Fort Worth-based Tarrant Regional Water District’s water (TRWD has the distribution permit, its officials said June 23), and the MUD signed an agreement with Key Ranch in 1993 to provide water after the subdivision’s well took on salt, WCCMUD’s then-general manager Tony Ciardo said at a town hall meeting about adding sewer service in 2024, The Monitor reported.
The Tool-based MUD identified the business interested in developing the land where cows now graze as an Overland Park, Kan., company named Diode Ventures, which says on its website that it builds solar farms and data centers and then sells them (another Diode data center has been proposed near Red Oak).
The water battle has moved directly to TRWD, which said at a June 23 community forum at Mabank Pavilion that it is its agency that has the permit controlling the distribution rights to Cedar Creek Lake water, which was impounded July 1, 1965, to provide additional water storage (along with flood control) following a drought that scorched Texas from 1949-1957.
On that early summer night last month, lake residents learned directly from TRWD officials, including TRWD Eastern Reservoir Manager Buckley “Bucky” Butler, about the future of Cedar Creek Lake water sales. The message: if there is enough water to sell from its capacity granted by the state, then it would be sold to any qualified applicant after vetting.
TRWD Water Resources Engineering Director Zach Huff said that when considering any water contract, TRWD would look at total future capacity as well as at past drought events. Huff also said that while TRWD staff would work on any permits, it is the TRWD Board of Directors (to which members are elected) that has final authority.
In addition, Huff said the State of Texas owns Cedar Creek Lake’s water. Also, TRWD Conservation Manager Justin Compton told the June 23 crowd that once the water district reaches 75% of its distribution capacity allotted by the State of Texas, the district begins Stage 1 drought-related conservation measures (West Cedar Creek MUD is at Stage 3 as of June 30).
Butler told a group at the Mabank Pavilion that no data center application or proposal had been submitted to TRWD, and Huff said that during peak summer evaporation, Cedar Creek Lake loses up to 250 million gallons daily. In addition, West Cedar Creek MUD’s water conservation plan shows that as of Aug. 6, 2023, its peak daily use was 2.995 million gallons per day while its system’s peak daily capacity was 5.512 million gallons per day.
Huff told The Monitor in 2023 that Cedar Creek Lake’s flow into the Integrated Pipeline Project (which brings more water from TRWD’s Cedar Creek and Richland Chambers reservoirs, as well as the City of Dallas’ water from Lake Palestine) became functional in spring 2022 and that while it increased TRWD’s water flow, it was still limited by a Texas Commission on Environmental Quality permit to an annual total of 175,000 acre-feet of water. At that time, TRWD was at 83% of its state-granted capacity of Cedar Creek Lake water, Huff said in 2023.
One hundred percent of that allowance – which the Integrated Pipeline Project allowed for as of 2022, if the water district needs it (according to Huff at that time) – is a maximum of 156 million gallons per day if the system pumped constantly at full capacity every day.
In Mabank, TRWD also talked about conserving water running through the Trinity River basin, which includes Cedar Creek and King’s Creek. One such conservation initiative is the Cedar Creek Wetlands Water Reuse Project and Ten Mile Pipeline, which TRWD says on its website is a 10-year effort that started in 2025, costing $187 million, to run Trinity River water through wetlands to yield cleaner water. It’s located at the tip of Henderson County, near the Farm to Market Road 85 bridge over the Trinity River at Porter’s Bluff.
That’s Henderson County Precinct 1 Commissioner Wendy Spivey’s territory. She said to TRWD officials June 23 that she would have never supported the wetlands project if she had known it might benefit a data center on the Key Ranch land, which Henderson County Appraisal District records show was sold by the Key family in 2023 to NRI Land Co LLC. Appraisal district records also show that April 15, 2025, a deed was recorded that reflects NRI Land Co. selling the thousand-plus-acre tracts to KC 2 Cypress Creek LP Etal, which is in Houston.
Spivey commented, “TRWD’s own 50-year plan projects future supply challenges, declining Cedar Creek yield and potential shortages as early as 2030 under drought conditions. Given those facts, how can TRWD justify committing water to a new hyperscale data center when that demand was not included in the planning assumptions used to determine the region’s future water reliability?”