SpaceX Plans $24 Billion Texas AI Data Centre and Gas Power Plant
The proposed development comes amid growing opposition to data centres across the United States. Notably, voters rejected such projects in 40 of 41 local ballot measures. Meanwhile, Democrats gained control of Congress and the Texas governor’s office following the midterm elections.
Several Democratic candidates had also campaigned on proposals to pause new data centre developments. Consequently, the project arrives during heightened political scrutiny of large-scale computing infrastructure.
SpaceX Seeks Tax Incentives for $24 Billion Investment
SpaceX has applied for a property tax abatement to support the proposed development. Earlier this year, the company acquired Elon Musk’s artificial intelligence business, xAI, strengthening its expansion into advanced computing.
The Starbase City Commission will review the tax abatement request at a public meeting on December 9. Additionally, officials will consider a related economic development agreement.
The project’s estimated $24 billion investment covers its initial development phases. However, the proposal allows for multiple construction stages and potential future expansions.
SpaceX intends to construct, own and operate both facilities. As a result, the company would directly control the project’s power infrastructure and computing operations.
Furthermore, developing an independent gas-fired power plant could help SpaceX avoid lengthy grid connection delays. Such delays can extend for years across Texas.
Nevertheless, the public notice leaves several important questions unanswered. It does not specify the proposed tax incentive’s value or duration. Similarly, the document provides no details about the power plant’s generating capacity or the computing facility’s planned scale.
Natural Gas Pipeline to Support Starbase Expansion
Meanwhile, SpaceX affiliate Lone Star Mineral Development has submitted plans for an eight-mile natural gas pipeline called Starpipe.
The pipeline will transport natural gas to Starbase, with operations scheduled to begin by January 2027.
According to earlier regulatory filings, the pipeline will supply a planned facility that converts natural gas into liquid methane. SpaceX intends to use this fuel for its Starship rockets.
Additionally, the proposed energy infrastructure could support the company’s broader industrial expansion at Starbase.
By developing dedicated energy facilities, SpaceX could gain greater control over power availability. This approach may also reduce its dependence on Texas’ main electricity grid.
AI Revenue Growth Drives Computing Expansion
SpaceX’s latest financial performance highlights its increasing focus on artificial intelligence and computing infrastructure.
The company recently reported a 161% increase in third-quarter revenue. More significantly, its AI revenue grew ninefold during the same period.
Meanwhile, SpaceX has been renting computing capacity to major technology companies, including Google and Anthropic.
The proposed supercomputing facility could therefore strengthen its position in the expanding AI infrastructure market.
Furthermore, combining dedicated electricity generation with advanced computing facilities could support growing demand for energy-intensive AI workloads.
However, the project’s final scope will depend on future development decisions and regulatory considerations.
The December 9 public meeting will mark an important step in evaluating the proposed tax incentives and economic development agreement.
If the project advances, the $24 billion investment could significantly expand Starbase’s role in energy infrastructure, artificial intelligence and advanced computing.
