Elon Musk’s SpaceX plans to invest more than $74 billion into building two data centers in Texas and Arizona, the company announced Thursday, marketing them as projects that will boost local communities amid backlash surrounding such facilities. “These investments will expand local tax bases, generate substantial new revenue for schools and public services, and create…
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Elon Musk’s SpaceX plans to invest more than $74 billion into building two data centers in Texas and Arizona, the company announced Thursday, marketing them as projects that will boost local communities amid backlash surrounding such facilities.
“These investments will expand local tax bases, generate substantial new revenue for schools and public services, and create economic opportunities that extend far beyond the facilities themselves,” the company said in a release.
SpaceX said it will put more than $24 billion into a new project in Texas’s Rio Grande Valley, expanding the company’s headquarters in Starbase — a coastal town the tech giant established in 2025 in a previously unincorporated area of Cameron County.
In Arizona, the SpaceX will invest around $50 billion in Cochise County, a rural area east of Tucson bordering Mexico and New Mexico.
SpaceX pledged the new projects will be created cooperatively with the surrounding communities and will be environmentally conscious. The company said the project in Texas would generate its own power and invest $220 million to expand the water supply in nearby Brownsville. While in Arizona, it vowed to work with local electric cooperatives and “potentially” reduce electric bills, saying the site would use dry cooling without water consumption.
“They require strong partnerships with local communities, responsible environmental stewardship, and stable, competitive policies that give companies the confidence to make long-term investments,” the company said in a release.
Both sites promise hundreds of permanent jobs even once construction is complete.
Data centers became a flash point in this year’s midterms, especially in Texas. Gov.-elect Gina Hinojosa (D) went after Gov. Greg Abbott (R) throughout their gubernatorial contest for the rapid expansion of data centers in the Lone Star State under his leadership.
Abbott ultimately announced a pause on new data center construction pending a statewide audit. Both candidates campaigned on restricting data centers, with Abbott bucking some in his party with the pledge.
The details SpaceX provided about the new project in South Texas appear to comply with at least some of Abbott’s stated demands.
Musk was closely involved in the Texas elections this year, spending hundreds of millions to back Republican candidate Ken Paxton, the state’s attorney general, in the high-stakes Senate race. Paxton went on to lose to Sen.-elect James Talarico (D) by more than 12 points.
The data center issue does not cleanly divide along party lines. Even as most national Republicans, including the president, have preached nonintervention in the AI boom, 54 percent of GOP voters in a Pew Research poll earlier this year said they would not be comfortable with a new local data center. Sixty-eight percent of Democrats said the same.
Though some lawmakers see potential for bipartisan cooperation at the federal level in the next Congress; on Wednesday, GOP Sen. Josh Hawley (Mo.) called on fellow Senate Republicans to pass a moratorium on new data centers — an idea some Democrats have pushed as well.
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