SpaceX Plans $24 Billion Gas Power Plant and Supercomputing Site at Starbase, Texas

The notice says SpaceX proposes to "construct, own, and operate" both facilities, and that the work could be carried out in several phases with room for later expansion. The project would be among the largest private investments in the Rio Grande Valley, according to Reuters, which reviewed the notice. Bloomberg News first reported the plan.

The decision to generate its own electricity matters as much as the price tag. Most AI data centres draw power from the local grid, but building a dedicated plant could let SpaceX avoid a wait of several years to connect to Texas's main power grid, Reuters said. It would also put SpaceX among a growing group of AI operators turning directly to natural gas: Anthropic agreed earlier on Monday to pay $3.4 billion for 1.7 gigawatts of gas-fired generators to power its data centres.

The notice leaves important questions open. It does not give the plant's generating capacity, the scale of the computing operation, or the size and length of the tax break SpaceX is seeking. A figure of 748 megawatts from 35 turbines has circulated in a post on X, CoinDesk reported, but it does not appear in the city's notice.

SpaceX has applied for a property tax abatement, which would also give it access to the Cameron County Enterprise Zone, according to CoinDesk. The Starbase City Commission is scheduled to consider the abatement and a related economic development agreement at a public meeting on December 9.

The proposal arrives as local resistance to data centres is hardening. Voters rejected data centres in 40 of 41 local ballot measures, Reuters said, and Democrats, some of whom campaigned on pausing new projects, won control of the US Congress and the Texas governor's office in the midterm elections. Democrat Gina Hinojosa, who defeated Republican incumbent Greg Abbott on November 3, campaigned against AI data centres, CoinDesk reported. Abbott ordered a pause in August on data centres moving through the state grid operator's connection process until regulators complete an audit, which also covers on-site power generation and the effect of facilities on local water and communities, according to the same report. Whether a self-supplied plant would let SpaceX sidestep that review is not addressed in the notice.

SpaceX has been expanding quickly in AI since it absorbed Elon Musk's AI lab xAI earlier this year. Last month the company reported that third-quarter revenue rose 161% and AI revenue grew ninefold, and it has been renting computing capacity to Google, Anthropic and others, Reuters said.

Gas supply to Starbase is already being planned for another purpose. A SpaceX affiliate, Lone Star Mineral Development, has filed plans for an 8-mile natural gas pipeline to the site, called Starpipe, scheduled to enter service by January 2027, according to filings Reuters reviewed in June. That line would feed a planned plant converting gas into liquid methane for Starship rockets. The notice does not say whether the power plant would draw on the same pipeline.

The December 9 commission meeting is the next public step, and the first point at which the terms of the tax break could become known.