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 CEO Elon Musk posted a photo of himself standing with the Optimus production team inside Tesla’s Fremont factory, arms crossed amid workers in hard hats and safety vests. The image captures a pivotal industrial shift: the same facility space once dedicated to building Tesla’s flagship Model S sedan and Model X SUV is now home to the company’s humanoid robot manufacturing line.
Walking the Optimus production line in Fremont pic.twitter.com/ABS0tuRibW
— Elon Musk (@elonmusk) July 1, 2026
Tesla’s Fremont Factory, acquired in 2010 from the former NUMMI joint venture between Toyota and GM, has been the company’s original U.S. manufacturing hub since Model S production began in 2012.
The Model X followed soon thereafter. These premium vehicles offered lower annual volumes, recently around 30,000 combined, compared to the high-volume Model 3 and Model Y lines that continue around the site. Over their combined run, the S and X accounted for roughly 610,000 units.
In late January 2026, during Tesla’s Q4 2025 earnings call, Elon Musk announced the end of Model S and Model X production in Q2 2026. The final vehicles rolled off the line in early May. Rather than retooling for another vehicle, Tesla chose to convert the dedicated S/X assembly area into a dedicated Optimus Gen 3 production line.
Model 3 and Y manufacturing remains unaffected. Tesla’s official Fremont Factory page now lists Optimus alongside the 3 and Y as core products.
The conversion was executed with remarkable speed. After production stopped, crews dismantled the existing vehicle line and installed entirely new modular equipment—including lines sourced from Germany and dozens of sub-lines for actuators, batteries, and other components—in roughly four months.
Musk described the timeline as “insanely fast,” noting it would be unprecedented for any other manufacturer. Initial Optimus output is expected to ramp slowly due to the robot’s roughly 10,000 unique parts and the brand-new production processes involved. The Fremont line targets an eventual capacity of 1 million Optimus units per year.
Tesla isn’t joking about building Optimus at an industrial scale: Here we go
Optimus Development Timeline
- August 19, 2021: Optimus (then called Tesla Bot) formally announced at Tesla’s first AI Day. A concept video showed a person in a suit demonstrating the vision for a general-purpose humanoid capable of dangerous, repetitive, or boring tasks using the same AI architecture as Full Self-Driving.
- 2022: Early prototypes displayed. At the second AI Day in September, semi-functional units demonstrated walking across a stage and basic arm movements
- 2023: September videos showed improved capabilities, including sorting colored blocks, precise limb awareness, and holding a Yoda pose.
- 2024-early 2025: Factory integration videos showed Optimus navigating workspaces and handling objects like battery cells.
- January 2026: Gen 3 mass-production activities began at Fremont, with reports of over 1,000 Gen 3 units already operating inside the factory for real-world learning and AI training
- April 2026: Musk confirms Optimus production on converted Fremont line would begin in late July or August 2026. The Gen 3 reveal, originally eyed for Q1, was pushed closer to production start. A second, much larger Optimus factory at Giga Texas is under construction, with volume production targeted for Summer 2027 and long-term capacity of 10 million units annually
- July 1, 2026: Musk’s on-site visit and team photo confirm the Optimus line is operational and the transition is actively progressing
Tesla positions Optimus as potentially its largest project ever, leveraging vertical integration, AI expertise, and car-like manufacturing know-how to scale humanoid robots first for its own factories and later for broader industrial and consumer use.
The Fremont conversion serves as a critical proving ground for this ambitious new chapter in Tesla’s already-rich history.
Investor's Corner
Tesla gets its latest short from Michael Burry: ‘Happy it jumped back to this level’
Tesla short seller Michael Burry, the subject of the film “The Big Short,” where he was portrayed by Steve Carell, has revealed he has opened a new bet against the stock.
In a new update to his Substack newsletter in a post titled “Trading Post June 30, 2026,” Burry revealed a new set of bets against Tesla, Caterpillar, NVIDIA, Applied Materials Inc., and the iShares Semiconductor ETF.
In regard to Tesla, Burry wrote:
“And finally I shorted Tesla at 416.22. Happy it jumped back to this level.”
This means Burry likely opened his new short position after the company’s recent rally on Wall Street, which saw Tesla shares sink in mid-May, only to recover to well over the $400 mark. Currently, shares trade at around $427.
The company saw a big Tuesday as shares climbed considerably, over 10 percent. The size of the Tesla short was not provided, nor did Burry give any information on the position’s structure, the number of shares, dollar value, or whether options were used in the short.
The Tesla and SpaceX merger everyone is talking about is quietly building
Over the years, Burry has been one of the more vocal critics of Tesla, calling its share price “media inflated,” and saying it was “ridiculously overvalued” as recently as December.
The company has largely transitioned away from being known as an automotive company and instead is much more widely regarded as an AI play, mostly due to its Full Self-Driving efforts, Optimus robot development, and data collection related to both.
This has not pulled those skeptics away from being vocal about their distaste for how Tesla is valued, but there’s no denying that the company is a global force in many things, including sustainable energy, automotive, and AI.
Wedbush Securities is initiating stock coverage on SpaceX (NASDAQ: SPCX), marking the first comments on the company since it went public several weeks ago. Wedbush and its analyst handling coverage, Dan Ives, are widely bullish on fellow Musk company Tesla (NASDAQ: TSLA).
Ives wrote his first note initiating coverage of SpaceX shares on Wednesday with a $190 price target and an ‘Outperform’ rating. The firm believes the company is well positioned off of its IPO because of its wide array of projects, including AI compute power and infrastructure, connectivity projects, and launches.
“We view SpaceX as one of the most differentiated assets within the tech market with a strong footprint across its three core markets, with Starlink driving success with connectivity,” Ives wrote, “Starship launches leading to a demand flywheel and increasing deal flow for its Colossus clusters.”
Elon Musk called it Epic: The full story of SpaceX’s Starship Flight 12
Wedbush leans heavily on Starlink, which they say is the “profitability driver given the strength of its recurring revenue base of ~12 million subscribers as of June 5th.” Ives believes Starlink is still in the “early innings” of penetrating the global telecommunications and broadband market, as it only holds less than a 1 percent share. However, this number is sure to increase over time.
It also highlights the importance of Starship, which it says is an “essential layer” of SpaceX’s overall success. SpaceX developing and displaying the ability to reuse rockets is a major cost and reliability advantage “as it reduces the necessary hardware launch costs while generating a feedback loop for future flights to improve their launch flight rate without accelerating capex spend.”
Finally, SpaceX’s recent AI/Compute projects are also very elementary, Ives writes. It is worth mentioning Wedbush said its $190 price target is derived from a valuation forecast that sees the company yielding roughly $2.48 trillion of implied enterprise value.
There are also some factors that Wedbush did not take into account with its initial coverage. The firm wrote in the note:
“We note that there is optional value coming from Starship’s accelerating scale towards sub-$200/kg unit economics, orbital data centers, and enterprise AI monetization as these factors could drive meaningful upside but these face major hurdles, so we do not take that into account with our valuation.”
SpaceX shares are down just over 2 percent today, trading at around $167 at the time of publication.
Tesla Optimus project fires up as Musk sees production line progress
Tesla gets its latest short from Michael Burry: ‘Happy it jumped back to this level’
