When Alphabet Inc. (GOOGL) announced it would spend $40 billion on AI infrastructure in Texas, Tesla Inc. (TSLA) CEO Elon Musk couldn't help but weigh in. On Friday, he called the spending on artificial intelligence computation "mind-blowing," which seems about right when you're talking about numbers with that many zeros.

Building Out the AI Future in Texas

According to Sundar Pichai, Google (GOOG) plans to pump $40 billion into Texas through 2027, developing cloud and AI infrastructure across the state. The investment includes new data centers in Armstrong and Haskell Counties, because apparently Texas has become ground zero for the AI arms race.

Power and People

Here's where it gets interesting: Google isn't just building servers. The company pledged to finance initiatives that would more than double Texas' anticipated electrician pipeline. Pichai emphasized the investment will create thousands of new jobs and "strengthen energy resilience and abundance," which is corporate speak for "we need a lot of electricity and people who know how to wire things."

That electricity concern isn't trivial. The International Energy Agency's World Energy Outlook 2025 report points out that AI data centers are driving a massive surge in electricity demand. Natural gas is making a comeback as a key energy source because renewable energy projects simply can't keep pace with the infrastructure needs. It turns out teaching computers to think requires an enormous amount of power.

Just the Beginning

Musk's response went beyond just calling the spending mind-blowing. He added, "But still many orders of magnitude to go," suggesting that current AI computing spending, astronomical as it seems, is just the opening act. If he's right, we're talking about investment levels that make $40 billion look quaint.

Musk has skin in this game too. His xAI is part of an investor consortium alongside Nvidia Corp. (NVDA), Microsoft Corp. (MSFT), and BlackRock Inc. (BLK) that's acquiring a separate $40 billion Texas data center. So when he talks about orders of magnitude more spending ahead, he's not just spectating from the sidelines.