Elon Musk has given up on solar power (on Earth)

2026-05-23 · Source: AI News & Artificial Intelligence | TechCrunch · Field: Technology & Digital — Artificial Intelligence & Machine Learning, Cloud Computing & IT Infrastructure, Emerging Technologies & Innovation · Depth: Novice, short

Summary

Elon Musk appears to be shifting away from terrestrial solar power for his AI ventures, as revealed in a recent SpaceX IPO filing. While Tesla's Master Plans historically focused on an "electrified economy" and "solar electric economy," xAI, one of Musk's companies, is now powering its data centers with dozens of unregulated natural gas turbines and plans to acquire an additional \$2.8 billion worth. This contrasts with xAI's \$697 million investment in Tesla Megapacks for grid-scale battery storage and SpaceX's \$131 million purchase of Cybertrucks. The filing indicates a focus on space-based solar power, which SpaceX claims can generate "more than five-times the energy" of terrestrial systems due to 24/7 illumination. Musk's "first principles" thinking suggests a concern that "terawatt-scale annual AI compute growth" will quickly outstrip Earth's power supply, noting current global data centers use around 40 gigawatts. Despite the economic challenges of orbital AI, Musk likely views current terrestrial data centers as temporary, anticipating future gigawatt-scale server deployment in space.

Key takeaway

For AI/ML Directors evaluating long-term infrastructure, Elon Musk's shift highlights a perceived future constraint on terrestrial power for AI. You should critically assess your organization's projected compute growth against available energy resources. Consider diversifying energy strategies beyond conventional renewables, potentially exploring modular natural gas solutions for immediate needs. Be aware that relying on unproven space-based solutions carries significant economic and logistical risks.

Key insights

Elon Musk's xAI is pivoting to natural gas and space-based solar, diverging from Tesla's terrestrial clean energy vision due to perceived AI compute growth limits.

Principles

• Space-based solar offers "five-times" terrestrial energy.
• AI compute demand may reach "terawatt-scale" annually.
• Terrestrial supply limits constrain data center growth.

In practice

• Evaluate space-based solar for future data center power.
• Consider natural gas turbines for immediate AI compute needs.
• Assess "first principles" thinking for long-term energy strategy.

Topics

• xAI
• Space-Based Solar Power
• AI Data Centers
• Natural Gas Turbines
• Energy Infrastructure
• Tesla Master Plans

Best for: CTO, VP of Engineering/Data, Entrepreneur, Director of AI/ML, Executive, Investor

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• AI Weekly Issue #501: Musk's $1.75 Trillion Bet Isn't a Rocket Company — Elon Musk's core wager is that AI's future bottleneck is power and compute, best solved by orbital data centers.
• The Orbital Data Center Hype Machine Is Already in Orbit — Orbital data centers face immense technical and logistical hurdles, making Elon Musk's aggressive timelines for cost-effectiveness highly improbable.

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Editorial summary, takeaway, and curation by AIssential. Original article published by AI News & Artificial Intelligence | TechCrunch.