SpaceX Seeks Tax Break for $24 Billion Gas Plant and Supercomputer at Starbase
SpaceX wants to build a gas-fired power plant and a supercomputing facility on 444 acres in Starbase, Texas, and is asking the city for a property tax break. A public hearing is set for December 9.
SpaceX is asking the city of Starbase, Texas, for a property tax break to build a gas-fired power plant and a supercomputing facility with an estimated initial investment of about $24 billion, according to a public hearing notice posted by the city on November 6.
The notice says Space Exploration Technologies Corp. “proposes to construct, own, and operate a gas-fired power plant and super-compute facility” on about 444 acres east of Brownsville, between Boca Chica Boulevard and the Port of Brownsville, in Cameron County. The Starbase City Commission will consider a property tax abatement and a related economic development agreement at a public hearing on December 9 at 7 p.m. Neither agreement has been approved.
Power for computing
The notice does not say how much power the plant would produce. A separate air permit application filed with the Texas Commission on Environmental Quality describes an initial setup of 35 natural gas turbines with combined capacity of about 748 megawatts, according to Construction Review Online. A later setup described in the filing would use eight larger GE Vernova 7E turbines totaling about 708 megawatts.
The project would give SpaceX its own power supply for computing work at a time when data center developers are struggling to get grid connections. SpaceX’s push into artificial intelligence is recent: in February, Elon Musk merged his AI company, xAI, into SpaceX in a stock swap that valued the combined firm at about $1.25 trillion, CoinDesk reported. A SpaceX job posting says Starbase is “standing up on-site power generation for the Starbase AI supercomputer.”
A hearing, and a state debate
The notice does not disclose the value of the tax relief sought, the length of any abatement, or what SpaceX would commit to in return, such as jobs or construction dates. It also does not say who would use the computing capacity or when construction would start.
The proposal lands in a wider Texas debate over data centers and power. Democrat Gina Hinojosa won the Texas governor’s race on November 3, defeating Republican incumbent Greg Abbott after campaigning against AI data centers. Abbott had already ordered a pause on August 3, halting new data center connections through the state grid operator until regulators finish an audit. The audit covers on-site power generation, and CoinDesk reported it remains to be seen whether SpaceX’s own plant would let it avoid that hurdle.
The December 9 hearing is the next public step. The air permit and other approvals remain separate requirements, and nothing has been approved yet.
Reporting based on coverage by CoinDesk and Construction Review Online.
