SpaceX has responded to a critical report from CNBC alleging that it has repeatedly polluted waters in Texas this year. As per the private space company, the publication’s allegations about its launch operations in South Texas were factually inaccurate.
In its report, CNBC alleged that SpaceX violated environmental regulations by “repeatedly releasing pollutants into or near bodies of water in Texas.” The publication cited a notice of violation from the Texas Commission on Environmental Quality (TCEQ) about SpaceX’s water deluge system at Starbase, Texas, as part of its sources for its article.
The TCEQ reportedly received a complaint alleging that SpaceX “was discharging deluge water without TCEQ authorization” on August 2023. A total of 14 complaints alleging environmental impacts from Starbase’s deluge system have reportedly been received by the Harlingen region, the publication noted.
SpaceX repeatedly polluted waters in Texas this year, regulators found https://t.co/0KfZIxElxV— CNBC (@CNBC) August 12, 2024
In its response, which was posted through its official account on X, SpaceX noted that it worked with the TCEQ when Starbase’s water deluge system was built. SpaceX also clarified that it has only used potable water in the operations of Starship’s water deluge system.
Following is SpaceX’s full response to CNBC’s allegations.
CNBC’s story on Starship’s launch operations in South Texas is factually inaccurate.
Starship’s water-cooled flame deflector system is critical equipment for SpaceX’s launch operations. It ensures flight safety and protects the launch site and surrounding area.
Also known as the deluge system, it applies clean, potable (drinking) water to the engine exhaust during static fire tests and launches to absorb the heat and vibration from the rocket engines firing. Similar equipment has long been used at launch sites across the United States – such as Kennedy Space Center and Cape Canaveral Space Force Stations in Florida, and Vandenberg Space Force Base in California – and across the globe.
CNBC’s story on Starship’s launch operations in South Texas is factually inaccurate.
Starship’s water-cooled flame deflector system is critical equipment for SpaceX’s launch operations. It ensures flight safety and protects the launch site and surrounding area.
Also known as…— SpaceX (@SpaceX) August 12, 2024
SpaceX worked with the Texas Commission of Environmental Quality (TCEQ) throughout the build and test of the water deluge system at Starbase to identify a permit approach. TCEQ personnel were onsite at Starbase to observe the initial tests of the system in July 2023, and TCEQ’s website shows that SpaceX is covered by the Texas Multi-Sector General Permit.
When the EPA issued their Administrative Order in March 2024, it was done without an understanding of basic facts of the deluge system’s operation or acknowledgement that we were operating under the Texas Multi-Sector General Permit.
After we explained our operation to the EPA, they revised their position and allowed us to continue operating, but required us to obtain an Individual Permit from TCEQ, which will also allow us to expand deluge operations to the second pad. We’ve been diligently working on the permit with TCEQ, which was submitted on July 1st, 2024. TCEQ is expected to issue the draft Individual Permit and Agreed Compliance Order this week.
Throughout our ongoing coordination with both TCEQ and the EPA, we have explicitly asked if operation of the deluge system needed to stop and we were informed that operations could continue.
TCEQ and the EPA have allowed continued operations because the deluge system has always complied with common conditions set by an Individual Permit, and causes no harm to the environment.
Specifically:
– We only use potable (drinking) water in the system’s operation. At no time during the operation of the deluge system is the potable water used in an industrial process, nor is the water exposed to industrial processes before or during operation of the system.
– The launch pad area is power-washed prior to activating the deluge system, with the power-washed water collected and hauled off.
– The vast majority of the water used in each operation is vaporized by the rocket’s engines.
– We send samples of the soil, air, and water around the pad to an independent, accredited laboratory after every use of the deluge system, which have consistently shown negligible traces of any contaminants. Importantly, while CNBC’s story claims there are “very large exceedances of the mercury” as part of the wastewater discharged at the site, all samples to-date have in fact shown either no detectable levels of mercury whatsoever or found in very few cases levels significantly below the limit the EPA maintains for drinking water.
– Retention ponds capture excess water and are specially lined to prevent any mixing with local groundwater. Any water captured in these ponds, including water from rainfall events, is pumped out and hauled off.
– Finally, some water does leave the area of the pad, mostly from water released prior to ignition and after engine shutdown or launch. To give you an idea of how much: a single use of the deluge system results in potable water equivalent to a rainfall of 0.004 inches across the area outside the pad which currently averages around 27 inches of rain per year.
With Starship, we’re revolutionizing humanity’s ability to access space with a fully reusable rocket that plays an integral role in multiple national priorities, including returning humans to the surface of the Moon. SpaceX and its thousands of employees work tirelessly to ensure the United States remains the world’s leader in space, and we remain committed to working with our local and federal partners to be good stewards of the environment.
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Tesla shared a striking video showcasing the decommissioning of the original Model S and Model X assembly line at its Fremont Factory in Northern California. Completed in just 46 days, the teardown involved heavy machinery dismantling concrete pits, removing robotic arms and conveyors, and clearing the space for new production.
The post, captioned “End of an era,” captured both the end of a historic chapter and Tesla’s aggressive pivot toward its next major initiative, Optimus.
End of an era: Decommissioning the original Model S & X assembly line in just 46 days pic.twitter.com/kGEdfhl62h
— Tesla Manufacturing (@gigafactories) July 10, 2026
The decision to retire the Model S and Model X originated during Tesla’s Q4 2025 Earnings Call in late January 2026. CEO Elon Musk announced that production of the company’s flagship sedan and SUV would wind down by the end of Q2 2026, describing it as bringing the programs to an “honorable discharge.”
Custom orders ceased around early April 2026, with the final vehicles rolling off the line in early May. A special signature delivery ceremony on May 20 marked the emotional close for these vehicles, which had defined Tesla’s early success and luxury EV segment since the Model S launch in 2012.
The primary reason for tearing down the lines was to repurpose the valuable factory floor space for high-volume production of Tesla’s Optimus humanoid robot. Musk had indicated on Earnings Calls that the Fremont S/X line would be replaced by a dedicated Optimus manufacturing line targeting a capacity of one million units per year.
This move aligns with Tesla’s broader strategic shift from traditional vehicle manufacturing toward robotics and artificial intelligence, leveraging the company’s expertise in autonomy, AI training, and high-volume production.
Optimus, Tesla’s general-purpose humanoid robot, is designed to perform repetitive or dangerous tasks in factories, warehouses, and eventually homes. Powered by Tesla’s AI and Neural Networks, it aims to be a versatile, affordable platform. Production of Optimus Gen 3 is already underway in limited form at Fremont, with full-scale output on the converted line expected to begin in late July or August.
Tesla is targeting rapid scaling, with internal ambitions pointing toward tens or even hundreds of thousands of units annually by the end of 2026.
Longer-term, Tesla is constructing a much larger second-generation Optimus facility at Giga Texas, with potential capacity reaching millions of units per year. The company views Optimus as a transformative product that could eventually surpass its automotive business in scale and value, enabling widespread deployment of useful robots across industries. CEO Elon Musk has even predicted it would be the most popular product of all-time.
As one era closes at Fremont, another is rapidly taking shape.
Elon Musk posted a candid admission on his social media platform X on June 9, declaring that he had been “clearly wrong” about Anthropic. The statement marked a notable reversal from his earlier skepticism toward the AI company.
In September, Musk had written, “Winning was never in the set of possible outcomes for Anthropic,” reflecting his view at the time that the startup had lacked the foundation or even the trajectory to succeed in what is an incredibly intense race for advanced artificial intelligence.
Musk’s latest post came amid discussion of Anthropic’s reliance on external compute resources. He praised the company’s progress, stating that Anthropic is “obviously currently the leader in AI” and that “no company has released a model as good as Mythos/Fable,” with expectations of a strong follow-up in Mythos 2.
The tone shifted dramatically from dismissal to acknowledgement of superior performance.
I was clearly wrong about Anthropic. They are obviously currently the leader in AI. No company has released a model as good as Mythos/Fable and they will undoubtedly have Mythos 2 ready soon.
And I would never cut them off in a way that hurt them badly, even as a competitor.…
— Elon Musk (@elonmusk) July 9, 2026
The context of Musk’s comments added significance. Anthropic has been operating under a recent compute deal with SpaceXAI, Musk’s AI infrastructure-focused venture. The pair entered a short-term GPU lease agreement initiated in May, providing Anthropic access to critical computing power for training and deploying its frontier models.
SpaceXAI signs agreement with Anthropic for massive AI supercomputer access
Some observers had speculated that Musk could leverage this dependency to disadvantage a rival. Musk directly addressed the possibility, writing, “I would never cut them off in a way that hurt them badly, even as a competitor. That’s not my style.”
To support his commitment to ethical competition, Musk referenced concrete examples from his other companies. Tesla famously open-sourced its entire portfolio of electric vehicle patents in 2014. The move was designed to accelerate the global adoption of sustainable transportation technology rather than protect proprietary advantages.
Tesla also made its Supercharger network available to competing electric vehicle manufacturers, transforming what could have remained an exclusive charging ecosystem into a shared infrastructure that benefits the broader industry and reduces barriers for EV adoption.
Musk further pointed to SpaceX’s practices, noting that the company launches satellites for competing commercial systems “with no increase in price or use of unfair terms.” He extended the principle to his social platform, observing that “even my worst enemies attack me on this platform,” underscoring preference for open discourse over retaliation.
These examples have illustrated Musk’s long-standing philosophy that long-term technological progress is best served by open competition and infrastructure sharing rather than leveraging market power to stifle rivals. In the fast-evolving AI sector, where compute resources and model capabilities determine leadership, Musk’s stance suggests a willingness to compete on innovation and performance alone.
Musk’s admission arrives as SpaceXAI itself advances its own frontier models while maintaining business relationships across the ecosystem. By publicly correcting his earlier assessment and reaffirming principles of fair play, Musk highlights a model of competition that prioritizes advancement of the field over short-term tactical advantages.
A Tesla analyst believes the company’s Full Self-Driving suite is close to an “inflection point,” where people will finally realize that it is more than what it appears, similar to how many view the iPhone.
Pierre Ferragu, an analyst who has covered Tesla for many years at New Street Research, says the Full Self-Driving suite is one piece of evidence supporting the view that a Tesla is more than a car. He compared it to the iPhone and noted that the high price tag seemed like a lot for a phone early on. Then people realized the iPhone was more than just something you make calls with. It made their lives simpler.
🚨 Analyst @p_ferragu says Tesla Full Self-Driving is at an “inflection point” in a recent commentary:
“A Tesla is not a car, the same way an iPhone was not a phone. As a tool that gets you to work peacefully every morning, it is not expensive. Give us 2 more quarters to see… pic.twitter.com/tm6xFrjVPV
— TESLARATI (@Teslarati) July 10, 2026
Suddenly, that price tag was justified.
Tesla offers several models under the average transaction price for a new vehicle, which was above $49,000, according to Kelley Blue Book. However, that does not take into account that many people can still not afford a $35,000 vehicle. Ferragu offers his thoughts:
“Remember when the addressable market of the iPhone was 10 million units? Then people realized how good it was, and now, nearly 250m are sold every year.
A similar evolution for Tesla is still on the table. A Tesla is not a car, the same way an iPhone was not a phone.
A model 3 at $35k + $100 per month is too expensive for most, but only as a car, the same way a $600 iPhone was too expensive for most, until most realized it was much more than a phone.
As a tool that gets you to work peacefully every morning, it is not expensive.”
This point is valid, especially considering the iPhone’s impact on the cell phone market. There are still a handful of players, but most people you know have an iPhone. The iPhone ties into Apple’s other ecosystem of products.
This is how Tesla plans to infiltrate the automotive market, and once the company offers a fully autonomous suite, or something that can allow for unsupervised self-driving, more and more people will flock to Tesla.
Ferragu believes Tesla needs two additional quarters of development before things will truly change. He didn’t elaborate on what will happen in two quarters, but he said it will give us all time to “see where this is heading.”
It is really quite interesting to see people’s reactions when they find out what a Tesla is capable of. Full Self-Driving is a great tool for taking stress out of travel; I use it daily, and it has made it really difficult to consider taking any other car on a drive of practically any length.
To me, it is really hard to believe that people will not at least seriously consider a Tesla as their next car if they experience Full Self-Driving. This is a major point for those who argue that Tesla should advertise in some way.
Tesla shows rapid teardown of Model S and X lines, paving the way for Optimus at Fremont
Elon Musk admits he was ‘clearly wrong’ about Anthropic
