After spending almost half a billion dollars to back Republican candidates in the midterm elections, many of whom lost on Tuesday, Elon Musk, the world’s richest man, is turning his attention back to corporate endeavors while still lamenting the blue wave that swept the U.S.
“Data centers in space looking pretty appealing right now,” he wrote in a post on X.com, the social network (formerly known as Twitter) he purchased in 2022.
Musk’s post comes as Democrats won major races in Texas, particularly Gina Hinojosa taking the governor’s office from Greg Abbott. Hinojosa ran on a platform calling for “an immediate moratorium on data centers … until the legislature can meet to put in place real protections so Texans can have a seat at the table to decide if and how data centers come into their communities.”
Thanks for subscribing!
The money news that actually matters.
By signing up, you accept Moneywise Terms of Use, Subscription Agreement, and Privacy Policy.
In addition, Hinojosa has proposed eliminating subsidies for data centers, no NDAs, and proof from builders that proposed data centers won’t increase household water and power bills.
A data center shortfall?
Musk’s SpaceX (NASDAQ:SPCX) is desperate for more compute as it competes with Anthropic and OpenAI, so any slowdown in data center expansion could hurt the company. (Shares were down just shy of 3% in mid-morning trading Wednesday, hovering at roughly the same price they IPO’d at in June.)
Brad Gerstner of Altimeter Capital says he believes Hinojosa’s election could result in a data center shortfall in the coming year.
“The consensus forecast … for next year is a total of 43 gigawatts coming online in 2027,” he said in a streaming interview on Polymarket Tuesday night.
“To put that in perspective, the total GW online at the end of 26, the cumulative in the United States, is about 38. So the consensus forecast we’re going to bring online more next year than all of the compute we built to date. I said on stage and it got a lot of blowback on Twitter at the time that we may end up building half of that online in 2027. Part of what I was concerned about was the growing backlash even from guys from Greg Abbott, but now with this blue wave I think it will slow it down even more. I think we can see 10-15 gigawatts of the expected build not come online.”
By speeding up his efforts to build data centers in space, Musk could limit the problems that could come with that shortfall.
Must Read
- Jeff Bezos backs a platform that lets anyone invest in rental homes for as little as $100 — 6 ways to build wealth like a landlord without actually being one
- The tax breaks in Trump's 'big beautiful bill' expire after 2028. Here are 4 moves to make before the window closes
Viability questions
While Musk has been beating the drum for extra-terrestrial data centers for some time, not everyone is convinced they’re such a good idea. In a report this April, for instance, the Government Accounting Office (GAO) raised concerns with the theory.
“Large data centers have power and cooling needs that will require further engineering development, such as solar arrays that are larger than any launched and assembled in space as of April 2026,” it wrote.
“Cooling solutions at this scale are also unproven. Large data centers produce waste heat that must be dissipated into space to prevent damage to computing systems. Such cooling is challenging because heat is not easily dispersed in the near-empty vacuum of space.”
JLL raises similar concerns, writing “cooling in space presents a paradox. While the vacuum of space offers near-zero operational cooling costs and immunity from ambient temperature swings, it creates a fundamental engineering challenge: heat cannot be convected away from equipment without air.”
Musk is ignoring those criticisms, saying the consistency of sunlight in space eliminates power constraints and the cost to build the centers will be lower. And, as he often does, he has set an aggressive deadline for workers to get the job done.
“I actually think that the cost of deploying AI in space will drop below the cost of terrestrial AI much sooner than most people expect,” he said in April. “I think it may be only two or three years.”
You May Also Like
- Dave Ramsey warns nearly 50% of Americans are making 1 big Social Security mistake — here’s what it is and 3 simple steps to fix it ASAP
- A single line on your car insurance policy could be inflating your premium by up to 30% — here's what to change
Chris Morris is a US based veteran journalist with more than 35 years of experience at many of the biggest digital news outlets. In addition to his activities as a writer, reporter and editor, Chris is also a frequent moderator and speaker at major conferences, including CES and South by Southwest.
