SpaceXAI is set to resume work on a wastewater treatment facility in Memphis to serve its data centers next year, almost 12 months after the project stalled.Elon Musk’s firm has told officials in Memphis that it will restart construction of the $80 million facility by Q1 2027.The water treatment facility, which SpaceXAI (formerly known as xAI) claims will be the largest of its kind in the world, was first announced in February 2025.Once complete, it will apparently allow the company to recycle 49.2 million liters (13 million gallons) of wastewater a day, and it has pledged to supply excess water to other businesses in Memphis, reducing strain on the Memphis Sand Aquifer, the primary water supply for the city.Though work on the plant, which is being built on land the company acquired from the city of Memphis, began in September 2025, it stalled in April, with SpaceXAI redirecting staff to other projects ahead of the much-anticipated SpaceX IPO.Musk had merged SpaceX and xAI in February 2026 as part of the IPO preparations, and said: “We need to focus on finishing Colossus 2 [the company’s second Memphis data center] and ensuring it is extremely stable, then will build the water recycling plant.”Officials from Memphis, including the city’s mayor Paul Young, as well as Doug McGowen, president of utility company Memphis Light, Gas and Water, met with SpaceXAI’s Michael Nicoll on Monday, per reporting from the Daily Memphian.“The City of Memphis can confirm that SpaceXAI has committed to resuming construction of its recycled wastewater treatment facility no later than Q1 2027,” a City of Memphis statement said.“The facility is critical infrastructure that will offset water usage from both SpaceXAI and [Tennessee grid provider] TVA. Mayor Young will continue the persistent engagement that led to this commitment until the facility is complete.”SpaceXAI operates two data centers in the Memphis, with a third currently under construction. They house the company’s Colossus supercomputer, and will provide capacity to Google and AI lab Anthropic, as well as AI coding firm Cursor, which SpaceXAI is in the process of acquiring, and Reflection.The company has faced criticism for the environmental impact of its data centers on communities in Memphis. Last week, the US Justice Department told a federal court to throw out a case, brought by the NAACP, that claims the data centers are damaging air quality in the area by illegally running dozens of portable natural gas turbines.