SpaceX has confirmed that Terafab is going ahead in Grimes County, Texas, on the Gibbons Creek Reservoir site, with construction beginning within months.
The numbers are difficult to hold in your head. Roughly 100 million square feet. A first phase around $55 billion, with total investment estimated as high as $119 billion — among the largest manufacturing investments in the history of the United States. A target output of one terawatt per year, which is where the name comes from.
But the detail that tells you what this actually is sits further down.
It is building its own power plants
SpaceX says it will construct its own natural gas plants to run Terafab, rather than drawing from ERCOT, the Texas grid.
Read that again in the context of everything else happening this year. Michael Saylor blamed bitcoin's slide on more than a trillion dollars of capital being vacuumed into AI data centres. Amazon is launching a satellite constellation partly to sell connectivity. Ford is dismantling its first EV strategy while the industry's capital goes elsewhere.
Here is that same story expressed as civil engineering: the compute build-out has reached a scale where a company would rather generate its own electricity than negotiate for a grid connection. Not because the grid is hostile — because it is not big enough, or not fast enough, and waiting is more expensive than building a power station.
SpaceX has also said the project will not raise electricity bills for local ratepayers, which is the natural consequence of not using their grid, and a promise worth holding it to.
The water question
Semiconductor fabrication is among the most water-intensive industrial processes there is. A facility of this size in a rural Texas county is, first and foremost, a water story.
SpaceX has said Terafab will not deplete local water resources and will not dry up the Navasota River. It has also confirmed that it owns the Navasota River pumping station.
Both things being true at once is the tension residents are pointing at. The company making the assurance about the river also controls the infrastructure that draws from it.
What the county gets, and when it got to speak
The financial terms are more favourable to Grimes County than the usual version of this story. The abatement is reported at roughly 78% rather than a full exemption, and in exchange SpaceX will pay the county a fixed $20 million a year for 35 years — about $710 million. A $10 million payment landed this month, meeting a deadline written into the June agreement.
That is a real number for a rural county, and it is not nothing that SpaceX is paying rather than simply taking.
The sequence is the part worth noticing.
The county cleared the way in June. The abatement was signed in June. SpaceX representatives met residents and local officials face to face for the first time this week, at the Commissioners Court in Anderson — to confirm that the agreements were already signed and active.
Nearly 900 residents then delivered a petition asking for independent legal counsel for the county, water and environmental safeguards, road repair requirements, emergency services funding, and clawback provisions if commitments are not met.
Those are not the demands of people trying to stop a project. They are the demands of people who have realised it is coming regardless and are trying to get terms — after the terms were set.
What is actually promised
It is worth separating the commitments from the aspirations.
Committed, on the record: the $20 million annual payment for 35 years; the abatement at roughly 78%; the assurances on ratepayer bills, local water and the Navasota River; SpaceX building its own generation.
Aspirational, and much larger: one terawatt of annual output; one gigawatt of orbital AI compute by the end of this year, scaling toward 100 gigawatts within about three and a half years; two chip families spanning vehicles, humanoid robots and satellites.
The first list is enforceable. The second is a plan, of the kind this company has both spectacularly delivered on and spectacularly missed on schedule.
What to watch
Whether the clawback provisions the petition asks for are ever added. What the first water permits actually authorise. And whether "our own natural gas plants" survives contact with Texas air permitting — because a company generating its own power at this scale is no longer only a chip manufacturer.
