SpaceX plans a 1.2GW gas-fired power plant to supply xAI data centers.

SpaceX plans to remove unpermitted turbines at its recently acquired xAI data centers and develop a 1.2 gigawatt natural gas power plant to support xAI's compute requirements. The move underscores the company's commitment to regulatory compliance and underscores the massive power infrastructure needed for AI-focused data centers.

The company has committed to purchasing US$2.8 billion of gas turbines over three years. Unpermitted turbines currently in use will be phased out by July 2027, allowing SpaceX to continue operations while addressing regulatory exposure.

SpaceX is expanding artificial intelligence and data capabilities alongside its core space and launch operations. The xAI acquisition represents a strategic pivot toward controlling more of the AI compute stack—not just supplying launch and satellite capacity. A dedicated power plant sized for high-density data centers suggests SpaceX intends xAI to operate at large scale, potentially supporting data processing for Starlink, orbital AI projects, and government contracts alongside major cloud providers.

The scale of the investment—both the 1.2 gigawatt facility and the multibillion-dollar turbine commitments—ties SpaceX's equity story more directly to energy infrastructure, permitting timelines, and data center economics. Near-term operational risks include regulatory uncertainty around the phased turbine removal and the capital intensity of layering US$2.8 billion in equipment purchases onto existing programs. However, SpaceX's recent revenue growth of 27.3% year-over-year and forecast earnings growth of 59.81% annually may provide financial flexibility to support these large-scale infrastructure investments.