Elon Musk wants to build a s $24 billion gas-powered AI supercomputer in Texas company town — massive 10 gigawatt site goes up for approval in December, but could face headwinds from new governor

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Starbase, Texas, which hosts SpaceX’s Starship rocket program, has just posted a notice of a public hearing for a gas-fired power plant and supercomputing facility within the corporate limits of the city. The project has an initial cost of $24 billion and will apparently be owned by SpaceX. Bloomberg reports that the project could face resistance from incoming Texas governor Gina Hinojosa, who campaigned against approving new data centers until the state’s legislature has enacted stronger protections against potential harms from those projects.

Until now, Elon Musk’s SpaceXSI has been building out its Colossus I and Colossus II data centers near the Mississippi-Tennessee border, but those projects have faced backlash, attracting a lawsuit from area residents that aims to curb the pollutants produced by the large number of gas turbines required to power those facilities.

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(Image credit: Microsoft)

Now, it seems that SpaceXSI wants to build another site in Texas that would lie in a city that mostly sits on land owned by SpaceX and whose population mostly comprises its own employees. The project might face reduced local opposition compared to the company’s Memphis facilities, as Starbase is essentially a company town for SpaceX. But Hinojosa’s arrival in the governor’s office could trump that seemingly permissible local regulatory climate.

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build 10 gigawatts of compute in 2027 alone, and the $24 billion budget for this new facility could make it one of the biggest and most expensive data center projects focused on a single site. The company’s announcement also notes that the $24 billion outlay it foresees was only for the “initial phases of the projects” and that it could “include future expansions.” That suggests that SpaceXSI could invest in more capacity in Starbase, Texas, going forward, assuming the favorable regulatory climate the company likely hoped for in the area holds.

Beyond its new terrestrial ambitions in Starbase, SpaceX also remains hard at work on launching data centers into space. Musk has already laid out the plans for a first-generation AI1 compute satellite with a 150kW peak compute payload, and submitted a proposal to build a 1-million-satellite Orbital Data Center System to the FCC. That work could accelerate after data center measures lost big in the poll in the recent U.S. midterm elections. In a post-election post on X, Musk ventured that “data centers in space looking pretty appealing right now.”