Policy Priorities for Electro-industrial Growth in the South-Central and Southwest United States

Introduction

A new era of electro-industrial growth is underway in the United States, with energy, manufacturing, and computing converging into a set of technologies that underpins economic competitiveness and energy security.¹ Seven South-Central and Southwest states — Arizona, Arkansas, Colorado, Louisiana, New Mexico, Oklahoma, and Texas — are well positioned to capture this opportunity.

RMI identified 95 core policy actions implemented in these states since 2022 across four action areas important to accelerating electro-industrial projects.² Building on priority policy approaches identified through RMI’s broader work in each action area, this analysis examines where South-Central and Southwest states have adopted elements of those approaches and where coverage could be improved to strengthen states’ competitiveness for electro-industrial growth.³ The four action areas are:

• Places: Building power-ready sites. Move toward integrated, power-ready delivery systems and improve permitting coordination.
• Powering the Markets: Shaping large loads and market demand. Adopt large-load performance standards and use purchasing power and demand-bundling tools to strengthen markets for priority products.
• Private Capital: Mobilizing private investment. Match support to barriers and build durable, flexible public financing programs and institutions to attract private capital.
• People: Building workforce pipelines. Align training with demonstrated employer and project needs and tie funding to employment outcomes.

Policy selection and policy design are related but distinct tasks. States must first diagnose what is impeding electro-industrial projects and identify an appropriate policy response. RMI’s “GREASE” framework can then help policymakers stress test how that response is designed: Governance (who owns implementation), Regional targeting (where resources are targeted), Expansive ambition (whether the incentive is scaled to the need), Accountability (how results are tracked), Sector strategies (whether the incentive targets the largest bottlenecks companies face), and Environmental co-benefits (what public benefits are embedded).⁴

This analysis uses GABRIEL, a generative pre-trained transformer (GPT)–based tool for systematically measuring attributes in qualitative text.⁵ Our analysis uses this tool to identify where GREASE design features are visible in the official text across the region’s 95 identified core policies. GABRIEL is used only to surface policies whose official text illustrates GREASE design features.⁶

The sections that follow take each action area in turn, setting current South-Central and Southwest states’ policy against priority policy approaches and pointing to the gaps and design elements that matter most.

The South-Central and Southwest Electro-Industrial Opportunity

RMI’s previous analysis of the Southeast established a framework for understanding the role states can play in accelerating electro-industrial development across sites, markets, finance, and workforce.⁷ The South-Central and Southwest states present a different regional context.

Regional electricity demand is growing rapidly, 33% from 2010 to 2025, compared with 8% nationwide, driven by data centers, the electrification of oil and gas operations, semiconductor and advanced-manufacturing investment, and population growth.⁸ The region also has a large existing energy and industrial base. The need for firm, reliable power for rising demand combined with the expertise to build emerging energy industries positions the South-Central and Southwest states to capture electro-industrial growth.

Next-generation geothermal provides one example: 78% of the US oil and gas extraction workforce is concentrated in these states. Those workers, paired with local subsurface resources and turbine manufacturing, create an opportunity to support geothermal deployment and its supply chain by building on existing capabilities.⁹

State policy across the region is already responding. Since 2022,¹⁰ these seven states’ governments have taken 95 core policy actions in four action areas relevant to supporting electro-industrial growth. Policy momentum has been greatest in Places and Private Capital, while People policies have been less common.¹¹

Counting policies, however, does not establish whether states have the tools they need. This analysis compares the regional inventory with RMI’s priority policy areas to show where elements of those areas are present in the region and where gaps remain. GREASE is then used separately to highlight existing policies with design features states can consider when developing or upgrading policies.

Places: Building Power-Ready Sites

Meeting industrial load growth requires delivering land, power, water, and permits on a credible schedule. A site that is certified on paper but lacks a clear path to land, power, water, and permits can delay a project for years. Two policy priorities can help states address these delivery bottlenecks: (1) integrating the components of site and power readiness, and (2) making permitting timelines more coordinated and predictable.

In the South-Central and Southwest region, states have already built many of the pieces needed to do both, across a variety of site-readiness, permitting, and infrastructure programs. Resource-access and permitting policies are the most prevalent, and most are tailored to specific technologies like geothermal, carbon storage, advanced nuclear, and transmission. Site-readiness programs are also in place, such as state funds for site preparation.¹²

Integrate site and power readiness

New Mexico offers an emerging model. SB 169 creates a strategic site-readiness framework that lets the state assess candidate sites across categories including infrastructure, utilities, environmental constraints, workforce, housing, land use, and ownership. SB 170 builds on that framework with utility cost recovery and expedited ratemaking review for projects serving incremental load growth so power infrastructure can move forward alongside site preparation rather than waiting on a signed tenant. Together, the bills show how a state can move beyond conventional site certification toward an integrated model that links site readiness, utility planning, permitting, and financing.¹³

Other states in the region have site-readiness and site-development tools — for example, Oklahoma’s SITES program and Arkansas’s local industrial development authorities could provide a foundation for more integrated delivery — but most of these tools still function mainly as individual land, infrastructure, finance, or utility mechanisms.¹⁴ They could build on New Mexico’s model by packaging zoning, utility services, water availability, power delivery, environmental review, and other compliance requirements into a single offering.

Coordinate industrial-project permitting

Permitting is one of the biggest bottlenecks new loads face, with multiagency processes compounding delays and creating uncertainty for developers. Better coordination can shorten timelines and give applicants visibility into where their permits sit at any given moment. Virginia Permit Transparency (VPT) provides an operating example outside the region. VPT is a centralized dashboard that tracks each step in the process, the target and actual timeline, and the agency or applicant accountable for advancing the permit.¹⁵

Several states are moving in this direction. Arizona’s statutory permitting dashboard lets sponsors of projects over $25 million register with the state, identify the permits they need across seven agencies, and track progress. Louisiana’s Lightning Speed Initiative assigns liaisons across 16 agencies for priority projects. These help projects move, but no state in the region yet gives applicants the visibility Virginia does. States could build on Virginia’s model by tracking each permit, publishing target and actual dates, and naming who is responsible for moving it forward.¹⁶

Applying GREASE to policy design for Places

Once a state identifies the site-readiness and permitting gaps and the policy instruments suited to addressing them, GREASE can help stress test the design of those instruments. Exhibit 1 applies the GREASE framework to existing South-Central and Southwest states’ policies, showing features they can consider carrying into new site-readiness and permitting instruments.

Exhibit 1

Powering the Markets: Shaping Large Loads and Market Demand

In the electro-industrial era, new large loads (e.g., data centers, battery plants, semiconductor fabrication plants) can either strain the grid or support durable grid investment, depending on how they are managed. States can help create more predictable demand for the products and infrastructure needed for electro-industrial growth by (1) setting appropriate standards for large new loads, and (2) using purchasing and buyer coordination to create durable demand where states or other institutions have meaningful purchasing power.

In the South-Central and Southwest region, states have already begun addressing the first challenge.¹⁷ Much of this activity focuses on cost responsibility, or who pays for the infrastructure needed to serve new large loads and on what terms. By contrast, the scan identified fewer policies that use public purchasing or buyer coordination to create predictable demand for electro-industrial products and materials.

Build on large-load rules

States can require large loads like data centers and advanced manufacturers to meet energy and storage requirements through regulatory standards. Clear performance expectations can help ensure that new loads support the investments needed to serve them, rather than add pressure to the system. Proposed models like Illinois’ SB 4016 would set requirements of this kind, aligning hyperscale data center growth with new clean electricity supply, though the rules are recent and model design remains contested.¹⁸

Oklahoma and Texas have each set terms for how new large loads connect to the grid and what share of costs they carry, protecting other customers from the expense of serving them. These are necessary protections, but none requires a large load to contribute to the supply it draws on. States could build on these rules by pairing cost protections with expectations for what large loads bring to the system.¹⁹

Use purchasing and buyer coordination to strengthen demand

States can use public budgets to purchase electro-industrial products, creating more predictable demand. Colorado’s Buy Clean Act offers a model that uses product standards in public construction and shows how procurement standards can shape demand for products that meet state-defined specifications.²⁰ Publishing forward-looking procurement pipelines can also help. Where demand is fragmented, states can also coordinate purchases so suppliers see a larger and more predictable market.

Current state-run examples of buyer coordination are limited, so this is best understood as an emerging practice rather than a demonstrated state model. States considering it should first test whether their own purchasing volume, or the demand they could aggregate across public institutions, is large enough to change what suppliers are willing to build.

Applying GREASE to policy design for Powering the Markets

Once a state identifies the market or large-load constraint it is trying to address and the policy instrument suited to addressing it, GREASE can help stress test the design of that instrument. Exhibit 2 applies the GREASE framework to existing South-Central and Southwest states’ policies to illustrate individual design features that policymakers can consider when designing demand-side policies.

Exhibit 2

Private Capital: Mobilizing Private Investment

The electro-industrial build-out is capital-intensive, and most of the required investment will need to come from private capital. Private lenders and investors do not provide capital unless a project’s expected returns, risks, size, and timing fit their respective requirements. Two policy priorities can help states more effectively mobilize private capital: (1) match public support to the specific economic or financing barrier, and (2) build durable public finance capacity where those barriers recur across projects.

Every state in the region has some form of incentive, grant, or financing mechanism that can apply to electro-industrial sectors, but the region leans toward use of project-specific support rather than building durable, flexible financing capacity.²¹

Match public support to the barrier

Effective public finance support starts by diagnosing the specific barrier preventing a project from moving forward and matching the intervention to that barrier. Public loans can provide financing where commercial debt is unavailable or too costly, while guarantees and other credit enhancements can address specific risks. States should aim to reduce transaction costs through clear eligibility, terms, and processes, while retaining flexibility to tailor support to the needs of individual projects.

Build durable public financing capacity for prevalent and recurring barriers

States can build durable public finance capacity rather than relying primarily on one-off subsidy packages and tax incentives. Dedicated public finance institutions can take targeted risks, mobilize private capital alongside public resources, recycle repayments into new projects, and build specialized expertise across transactions. Durable institutions can also provide greater policy continuity across political and budget cycles, giving developers and investors confidence that financing capacity will remain available.

State financing authorities in the region, such as the New Mexico Finance Authority and the Arkansas Development Finance Authority, operate at scale but are not built around electro-industrial projects; most other state programs are tied to a single technology or project type.²²

States should first assess whether existing institutions have the mandate, capital, and administrative capacity to address recurring financing gaps. Where they do not, states can expand or adapt existing capacity, or establish new funds or institutions designed around their needs.

Applying GREASE to policy design for Private Capital

Once a state identifies the public finance tools needed, GREASE can help stress test the design of that instrument. Exhibit 3 applies the GREASE framework to existing South-Central and Southwest states’ policies to illustrate individual design features that policymakers can consider when designing public finance policies.

Exhibit 3

People: Building Workforce Pipelines

Even with capital committed, projects stall without the people to build and run them. Nationwide, the workforce constraint is acute: 1.9 million manufacturing jobs could go unfilled between 2024 and 2033 if workforce constraints persist,²³ with 45% of construction firms reporting project delays in 2025 caused by worker shortages.²⁴ In general, two policy priorities can strengthen workforce delivery: 1) aligning training with demonstrated employer and project needs, and 2) tying public funding and performance measurement to employment outcomes.

In the South-Central and Southwest region, states have begun connecting workforce programs to electro-industrial sectors, although recent policy activity is more limited than in the other three action areas. Recent activity is concentrated in sector workforce investments and employer-linked training and apprenticeship programs across advanced manufacturing, semiconductors, and other technologies.

Align training with employer needs

Employer-driven training starts with understanding the specific roles, competencies, hiring timelines, and so on required by employers and their project pipeline, and translating those needs into training programs. Virginia’s Talent Accelerator Program and Georgia’s Quick Start program provide established examples outside the region of no-cost, customized recruitment and training built around the needs of qualifying employers.²⁵ In Georgia, SK Battery America’s president said Quick Start training was “crucial” to meeting production timelines at its first US plant.²⁶

The regional scan shows a clear foothold for employer-linked training programs in place. Arizona’s Future48 Workforce Accelerators and ReadyTechGo combine employer-designed training centers with community college curricula. Arkansas’ HIRED grants support regional employer–education partnerships, and New Mexico funds community college programs developed with laboratories, agencies, and industry.²⁷

Tie public funding to employment outcomes

Where workforce programs do not already do so, states can connect funding to outcomes such as training completion, placement, retention, and wages rather than enrollment alone. Outside the region, California’s Employment Training Panel provides a model of performance-based contracting at scale, with reimbursement earned per trainee only after minimum training hours and a 90-day employment retention period. This structure aligns public investment with actual labor market outcomes rather than just program enrollment.²⁸

The regional scan shows a more limited foothold for outcome-based funding. Oklahoma’s Talent Accelerator is the clearest example: it reimburses 50% after approved training completion and an additional 30% after six-month retention.²⁹ Arkansas’ HIRED grants also incorporate employment outcomes into grant delivery,³⁰ but most other electro-industrial workforce policies in the scan emphasize credentials and apprenticeships rather than conditioning payment on placement, retention, wages, and job quality. States could build on these models where those requirements are not already in place.

Applying GREASE to policy design for People

Once a state identifies a specific workforce constraint and the policy response suited to addressing it, GREASE can help stress test the design of that response. Exhibit 4 applies the GREASE framework to existing South-Central and Southwest states’ policies to illustrate individual design features that policymakers can consider when designing workforce policies.

Exhibit 4

Assessing Policy Coverage and Design

Our scan shows where South-Central and Southwest states have already adopted elements of these approaches and where coverage is less developed. Because the scan is not comprehensive, and because differences in coverage do not by themselves establish a policy need, states can use these findings as a starting point to identify coverage differences and assess whether they correspond to material barriers to investment in the electro-industrial era.

Where differences correspond to investment barriers, states should identify an appropriate policy response, and GREASE is one policy design framework that policymakers can use to implement the design choices that matter most: who owns delivery, where resources are targeted, whether the intervention is scaled to the need, how results are tracked, whether the intervention reflects sector-specific constraints, and whether additional public benefits are embedded.

Acknowledgements

The New Energy Industrial Strategy Center

The NEIS Center is a thought partner, funder, and community builder that helps create advanced energy systems that support competitive economies and power the industries of the future.

Additional Contributors

Tyler Farrell, Ben Feshbach, Molly Freed, Allie Jobe, Brian O’Hanlon, Hannah Perkins

Appendices

Appendix A: Policy Inventory and GABRIEL Scorecard

Policy selection guardrails

This inventory is a conservative core inventory, not an exhaustive scan of all state economic-development, energy, infrastructure, and workforce policies in the South-Central and Southwest region. Policies were included only if they were state-created statutory, executive, regulatory or budgetary, or agency actions adopted, funded, or materially implemented between January 1, 2022, and July 16, 2026. They also had to directly change investment, delivery, power or site readiness, demand creation, financing, or workforce conditions for electro-industrial growth. Repeated appropriations, technical corrections, eligibility updates, or implementation steps were folded into an existing row unless they materially changed the program. Individual-utility tariffs and dockets, local policies, company-specific awards, proposed bills, planning-only studies, and generic economic-development, childcare, housing, education, or workforce policies were excluded unless they had a clear electro-industrial delivery mechanism.

Exhibit A1 presents RMI’s South-Central and Southwest region policy inventory of 95 investment-led policy actions (2022–26), of which 86 were adopted, funded, or materially implemented through 2025 and nine in 2026 before the July 16 research cutoff. Higher scores from GABRIEL indicate greater visibility of a design element in the text; they do not represent policy strength, state performance, or predicted project outcomes. To reduce artificial intelligence (AI)–error risk, every policy included in the inventory was checked against official state source material.³¹

Exhibit A1

Appendix B: Methodology — GREASE Scoring Rubric and GABRIEL QA

Each policy is scored 0–100 on six GREASE design elements using the anchors in Exhibit B1. GABRIEL, an AI-assisted scoring tool, draws on official state sources (.gov domains) to produce evidence-based scores. The neutral default for unclear evidence is 50. Each policy family is scored once, and its scores are reused across all of its action-area assignments. Scores are intended as decision-support tools for surfacing visible design features in official text, not definitive legal assessments, effectiveness ratings, or state rankings.

Exhibit B1

Endnotes

[1] Lachlan Carey et al., GREASE Lightning, RMI, 2025, https://rmi.org/resources/grease-lightning-2/.

[2] RMI analysis of the South-Central and Southwest core policy inventory, based on official state policy source documents compiled for this inventory and on file with the authors, August 2026.

[3] Jon Ekberg, Lachlan Carey, and Aaron Brickman, Policy Priorities for Electro-Industrial Growth in the Southeast United States, RMI, 2026, https://rmi.org/resources/policy-priorities-for-electro-industrial-growth-in-the-southeast-united-states/.

[4] Carey, GREASE Lightning, 2025.

[5] Hemanth Asirvatham, Elliott Mokski, and Andrei Shleifer, GPT as a Measurement Tool, National Bureau of Economic Research Working Paper No. 34834, February 2026, https://www.nber.org/papers/w34834.

[6] Throughout this report, the policy examples cited in each exhibit illustrate individual design features and are not endorsements of the policies as a whole, nor an indication that the policy addresses the right problem, uses the appropriate instrument, or has been effective.

[7] Ekberg, Policy Priorities for Electro-Industrial Growth in the Southeast United States, 2026.

[8] Galen Bower et al., Building a Geothermal Powerhouse Region in the South-Central and Southwest United States, Rhodium Group and RMI, 2026, 4, https://rhg.com/research/geothermal-south-central-southwest-states/.

[9] Bower, Building a Geothermal Powerhouse Region, 2026.

[10] The January 1, 2022, start date captures the current wave of state-level, investment-led industrial policy following major federal infrastructure, clean-energy, semiconductor, and advanced-manufacturing legislation. The scan closes on July 16, 2026.

[11] The full South-Central and Southwest regional policy and program list is available in Appendix A.

[12] RMI analysis of the South-Central and Southwest core policy inventory for Places, based on official state policy source documents compiled for this inventory and on file with the authors, August 2026.

[13] Senate Bill 169: Strategic Economic Development Site Readiness Act, Chapter 70, New Mexico Legislature, signed April 7, 2025, https://www.nmlegis.gov/Sessions/25 Regular/final/SB0169.pdf; and Senate Bill 170, Chapter 71, New Mexico Legislature, signed April 7, 2025, https://www.nmlegis.gov/Sessions/25 Regular/final/SB0170.pdf.

[14] House Bill 461, Act 365, Louisiana Legislature, signed June 20, 2025, https://www.legis.la.gov/Legis/BillInfo.aspx?i=248469; “Louisiana Selects 19 FastSites in Historic State Investment,” Louisiana Economic Development, March 3, 2026, https://www.opportunitylouisiana.gov/news/louisiana-selects-19-fastsites-in-historic-state-investment; 15 CAR sec. 195-103, “Arkansas Site Development Grant Program Funding,” Arkansas Code of Rules, updated July 7, 2026, https://codeofarrules.arkansas.gov/Rules/Rule; Senate Bills 169 and 170, New Mexico Legislature, 2025; “SITES Program,” Oklahoma Department of Commerce, accessed August 2026, https://www.okcommerce.gov/community-development/local-governments-edos/sites-program/; and Act 576 of 2025, Industrial Development Authorities Expansion Act, Arkansas General Assembly, https://www.arkleg.state.ar.us/Bills/Detail?measureno=SB361.

[15] “About VPT,” Virginia Permit Transparency, accessed August 2026, https://permits.virginia.gov/Home/About.

[16] Arizona Revised Statutes § 41-2104 (permitting dashboard), https://www.azleg.gov/ars/41/02104.htm; “State Permitting Dashboard,” State of Arizona, accessed August 2026, https://results.az.gov/our-results/state-permitting-dashboard; “Louisiana Lightning Speed Initiative,” Executive Order JML 25-102, Louisiana Office of the Governor, 2025, https://gov.louisiana.gov/news/4942; Minutes of December 17, 2025, Louisiana Public Service Commission, https://lpsc.louisiana.gov/docs/minutes/Dec_17_2025_Min.pdf; Executive Order 26-04, Arkansas Office of the Governor, February 16, 2026, https://governor.arkansas.gov/executive_orders/sanders-signs-executive-order-to-speed-permitting-for-economic-development-projects/; Executive Order 2026-023, New Mexico Office of the Governor, April 22, 2026, https://www.governor.state.nm.us/wp-content/uploads/2026/04/Executive-Order-2026-023.pdf; and RMI analysis of the South-Central and Southwest core policy inventory, January 1, 2022–July 16, 2026.

[17] RMI analysis of the South-Central and Southwest core policy inventory for Powering the Markets, based on official state policy source documents compiled for this inventory and on file with the authors, August 2026.

[18] Senate Bill 4016 (104th General Assembly), Illinois General Assembly, introduced 2026, accessed July 2026, https://www.ilga.gov/Legislation/BillStatus?DocNum=4016&DocTypeID=SB.

[19] House Bill 2992, Data Center Customer Ratepayer Protection Act of 2026, Oklahoma Legislature, 2026, https://www.oklegislature.gov/cf_pdf/2025-26 ENR/hB/HB2992 ENR.PDF; and Senate Bill 6, 89th Leg., Texas Legislature, 2025, https://capitol.texas.gov/tlodocs/89R/billtext/html/SB00006F.htm.

[20] “Buy Clean Colorado Act,” Colorado Office of the State Architect, accessed July 16, 2026, https://osa.colorado.gov/energy-environment/buy-clean-colorado-act.

[21] RMI analysis of the South-Central and Southwest core policy inventory for Private Capital, August 2026.

[22] RMI analysis of the South-Central and Southwest core policy inventory for Private Capital, August 2026; “About,” New Mexico Finance Authority, accessed August 2026, https://www.nmfinance.com/; and “About Us,” Arkansas Development Finance Authority, accessed August 2026, https://adfa.arkansas.gov/.

[23] Taking Charge: Manufacturers Support Growth with Active Workforce Strategies, Deloitte and The Manufacturing Institute, 2024, https://www.deloitte.com/us/en/insights/industry/manufacturing-industrial-products/supporting-us-manufacturing-growth-amid-workforce-challenges.html.

[24] 2025 Workforce Survey Analysis, Associated General Contractors of America and National Center for Construction Education and Research, 2025, https://www.agc.org/sites/default/files/users/user21902/2025 Workforce Survey Analysis (3).pdf.

[25] “Virginia Talent Accelerator Program,” Virginia Economic Development Partnership, accessed March 2026, https://www.vedp.org/incentive/virginia-talent-accelerator-program; and “Georgia Quick Start,” Georgia Department of Economic Development, accessed April 2026, https://georgia.org/quick-start.

[26] “SK Battery America,” Georgia Quick Start, accessed May 29, 2026, https://www.georgiaquickstart.org/projects/sk-battery/.

[27] RMI analysis of the South-Central and Southwest core policy inventory for People, based on official state policy source documents compiled for this inventory and on file with the authors, August 2026; “Future48 Workforce Accelerators,” Arizona Commerce Authority, accessed August 2026, https://www.azcommerce.com/future48-workforce-accelerators/; and “Governor Sanders, Department of Commerce Award $48M in Employer-Driven HIRED Training Grants,” Arkansas Department of Commerce, November 14, 2024, https://commerce.arkansas.gov/governor-sanders-department-of-commerce-award-48m-in-employer-driven-hired-training-grants/.

[28] “About Us,” California Employment Training Panel, accessed July 16, 2026, https://etp.ca.gov/About-Us/.

[29] Workforce System Directive WSD 02-2026, Oklahoma Employment Security Commission, effective March 4, 2026, https://www.oklahoma.gov/content/dam/ok/en/workforce/documents/policies/directives/2026/WSD-02-2026-Industry-Driven-Skills-Training-GUILD.pdf; and “Oklahoma Launches New Talent Accelerator to Strengthen Workforce Pipeline,” Oklahoma Employment Security Commission, February 2026, https://oklahoma.gov/oesc/about/newsroom/2026/february/oklahoma-launches-new-talent-accelerator-to-strengthen-workforce.html.

[30] “Governor Sanders, Department of Commerce Award $48M in Employer-Driven HIRED Training Grants,” 2024.

[31] RMI, South-Central and Southwest core policy inventory (locked scoring workbook) and associated GABRIEL scoring and validation outputs, August 2026, on file with the authors.