Elon Musk has a new reason to look up. After Democrat Gina Hinojosa defeated three-term Republican Governor Greg Abbott in Texas, the Tesla and SpaceX chief renewed his pitch for space-based artificial intelligence data centers, where her proposed restrictions on new facilities have raised concerns about the future of AI infrastructure development.

"Data centers in space looking pretty appealing right now," Musk wrote in an X post on Wednesday, following Hinojosa's victory.

Hinojosa has demanded an immediate moratorium on new data centers until lawmakers establish stronger protections for electricity supplies, water resources and local communities. "We need a moratorium on data centers until the legislature can meet to put in place real protections," she said in an August campaign statement.

However, Abbott had already halted new data center permits in September, pending an electricity-grid audit. Hinojosa wants to maintain restrictions until lawmakers establish enforceable safeguards, raising questions about how quickly developers can expand their operations.

America's Surging Electricity Demand Raises Concerns

The North American Electric Reliability Corporation warned that peak summer electricity demand could increase by 224 gigawatts over the next decade, largely because of AI data centers and other power-intensive industries. Its assessment identified growing reliability risks across electricity networks, including Texas' ERCOT and the mid-Atlantic PJM region.

Reuters previously reported that Texas was reviewing proposed data center connections representing more than 400 gigawatts of potential demand, although many projects remained speculative. The growing pressure on electricity supplies has intensified scrutiny of AI infrastructure expansion.

Musk Sees Space As Computing's Future

Musk previously predicted that monthly additions to orbital computing capacity could surpass terrestrial additions by late 2028, citing electricity and regulatory constraints. He also argued this week that cooling AI equipment in space is easier, because radiators can release heat directly into space.

Reuters reported in June that Space Exploration Technologies Corp. (NASDAQ:SPCX) aims to test orbital AI infrastructure by late 2027, although large-scale deployment depends on Starship's launch capabilities and lower costs.

Price Action: SPCX shares were trading 1.75% lower at $138.84 in after-hours trading on Tuesday, according to market data.