As I wrote about earlier this week, xAI has broken ground on a second data center on Tulane Road here in Memphis that will require an unbelievable amount of electricity. Today, the Greater Memphis Chamber of Commerce sent an email saying:

xAI is demobilizing turbines in Shelby County and has no plans to site any turbines at its Tulane location. The company continues to evaluate various power solutions for its Memphis facilities while working within all applicable regulatory frameworks.

However, as Samuel Hardiman at The Daily Memphian reports, The Southern Environmental Law Center obtained a document outlining plans to do just that: using gas turbines to help power the massive supercomputer.

Here’s a bit from the SELC’s press release:

Methane gas turbines release smog-forming pollution and hazardous chemicals like formaldehyde. These pollutants are tied to increases in asthma, respiratory diseases, heart problems, and certain cancers and are especially harmful to children. XAI’s second data center is planned for South Memphis’ Whitehaven neighborhood and is roughly half a mile from homes and a school.

“XAI appears to be preparing for a truly staggering number of polluting turbines for its second South Memphis data center, all while continuing to run unpermitted turbines nearby,” Amanda Garcia, a senior attorney at the Southern Environmental Law Center, said. “Memphians have repeatedly told local leaders they have serious concerns about how these data centers and their use of gas turbines will impact the air they breathe every day. Local leaders and health officials should be standing with the communities they serve—not a power-hungry company with a history of breaking the rules.”

This week, the Memphis Chamber of Commerce announced xAI would be removing an undisclosed number of gas turbines—which the company had been operating without any permits—from its first South Memphis location. However, this new discovery raises significant concerns that the company may be planning to move the polluting turbines from one South Memphis data center to another.

Hardiman writes:

The Tulane Road data center is much closer to a large population base than the company’s other data center. The Environmental Protection Agency estimates 64,000 people live within a 3-mile radius of the Tennessee Valley Authority’s Southaven Combined Cycle Plant, a mere 100 yards from xAI’s Tulane Road site.

And:

The document describes the plans for turbines as a greenfield use. Since buying the land in early March, the company has cleared dozens of acres at the Tulane Road site.

The document indicates plans were submitted to the Shelby County Health Department in a request for feedback.

“This will be a grass roots operation and facility. The proposed facility will produce its own electricity for sale and will include simple cycle combustion turbines (CT) and supporting equipment,” the document said.

As seen here, the SELC has photographic evidence that some 35 turbines have been in operation at xAI’s initial data center, despite Memphis Mayor Paul Young claiming in mid April that only 15 were in use. If 15 strikes you as an oddly specific number, it’s because the Shelby County Health Department’s permit to xAI only covers 15 permanent units.

If the plan outlined in this documents comes to pass, there could be anywhere between 40 to 90 turbines running in south Memphis across the two sites.

Dyana Bagby, writing in 2024 for Georgia Public Broadcasting, the PBS/NPR affiliate in Atlanta:

The Atlanta City Council voted Tuesday, Sept. 3, to ban data centers along and near the Atlanta BeltLine and within a half-mile of MARTA stations.

The new legislation aims to preserve new residential and mixed-use developments, trails and green space along the 22-mile BeltLine trail loop encircling the city’s urban core. The council also wants to make sure the BeltLine remains focused on building more affordable housing and providing a safe space for pedestrians, cyclists and others in non-vehicular modes of transportation.

“This legislation has set Atlanta apart from other cities across the country in that we’re looking to make some changes in how we treat data centers in our urban core,” said Councilmember Jason Dozier at Tuesday’s meeting. He and Councilmember Matt Westmoreland introduced the legislation earlier this year.

In Memphis, no such legislation exists. The state of Tennessee offers a sales and use tax exemption with the following requirements:

• Minimum capital investment of $100M
• The creation 15 new full-time positions paying at least 150% of the state’s average occupational wage¹
• Investment must be made during a 3 year period.

Earlier this year, it was reported by The Commercial Appeal that xAI had requested no additional tax incentives, and the land deal was disclosed:

The xAI facility has been privately funded. The planned expansions of the xAI supercomputer are also expected to be privately funded.

In October 2024, the Economic Development Growth Engine for Memphis and Shelby County (EDGE) approved a 21-year lease for 522 acres in Frank C. Pidgeon Industrial Park for Nashville-based CTC Property LLC, an affiliate company of xAI. The 522 acres are owned by EDGE and located southeast of the xAI facility on Paul R. Lowry Road.

After the 21-year lease expires, CTC Property can opt to purchase the 522 acres for $23,642,293. The company will pay $1,654,961 annually in rent for the property with 2.5% yearly increases in that base rent, according to the EDGE lease terms.

After October’s approval of the land lease, it became clear that xAI’s project was going to be much larger than initially described, as reported by Stephen Smith:

On December 4, at the Greater Memphis Chamber Annual Chairman’s Luncheon, a representative for xAI revealed plans for an expansion of its aptly named “Colossus” supercomputer facility. According to the Chamber’s press release, the expansion is already underway, and will incorporate a minimum of one million GPUs, marking the largest capital investment in the region’s history. Additionally, Fortune 500 tech giants Nvidia, Dell, and Supermicro Computer (SMC) will be establishing operations in Memphis.

What wasn’t mentioned at that meeting was the new level of power that will be required for this size of facility: presumably, this jump in capacity would increase power demand by roughly 10x as well (from 150 MW to over 1,000 MWs). This previously unannounced capacity makes this a “hyperscale” project.

Even more concerning is the fact that we are far from convinced that xAI didn’t know when they first came to Memphis that they would expand the plans 10x. This is a classic bait and switch: xAI proposed one thing, and grew support from stakeholders like the Greater Memphis Chamber, the Memphis Shelby County Economic Development Growth Engine (EDGE), TVA, and governing authorities. Musk and crew moved forward on the path to operating the facility, and only then announced a change in magnitude that creates a fundamentally different situation for public health in Memphis, economic stability for ratepayers, and environmental security.

Best I can tell, that expansion triggered no revisiting of the agreements between the city and xAI, and Memphis mayor Paul Young (whom I voted for!) seems to have been caught flat-footed as recently during a March community event:

Mayor Young received some pushback from the crowd on his position that xAI would help the city grow, arguing the tax revenue generated would be used to address the needs of Memphis, specifically in 38109 [the ZIP code where xAI’s first Memphis location is located].

“I wanna figure out how we can exploit this project for us,” Mayor Young told the audience. “I know you feel like it’s us getting exploited, but we need to speak from a place of strength.”

Ariel Wittenberg for Politico, writing about xAI’s use of gas turbines to power its supercomputer in Memphis:

Just three miles away is Boxtown, a secluded neighborhood that officially became part of the city of Memphis in 1968, the year that the Rev. Martin Luther King Jr. was assassinated at the Lorraine Motel downtown. While the annexation had come with the promise of connecting Boxtown to municipal utilities, many homes still had no running water or sewage service as late as the 1970s.

Today, more than 90 percent of residents living in Boxtown’s ZIP code are Black, with a median household income of $36,000, according to the Census Bureau. It’s also home to more than 17 industrial facilities — some of which share an industrial park with xAI — that release enough toxic pollution to require registration with EPA’s Toxics Release Inventory.

“I can’t breathe at home, it smells like gas outside,” Boxtown resident Alexis Humphreys said through tears, holding up her asthma inhaler during a public hearing about the turbines on April 25. “How come I can’t breathe at home and y’all get to breathe at home?”

This morning, I was emailed a press release from the Greater Memphis Chamber of Commerce. Here is the release in its entirety:

On Thursday, May 1, 2025, less than one year from the project announcement, xAI reached full operational capability for Phase I of the two Phase operation at the former Electrolux site. xAI was connected to a newly constructed electric substation (#63) from which it is now receiving 150MW of grid power from MLGW and TVA. Additionally, 150MW of Megapack Batteries for stored energy backup have been integrated into the operation, to help the system ride through outages, or demand response events during times of peak grid demand.

The temporary natural gas turbines that were being used to power the Phase I GPUs prior to grid connection are now being demobilized and will be removed from the site over the next two months. About half of the operating turbines will remain operating to power Phase II GPUs of xAI until a second substation (#22) already in construction is completed and connected to the electric grid, which is planned for the Fall of 2025, at which time the remaining turbines will be relegated to a backup power role.

xAI is committed to Memphis through their sustainable environmental practices. The company is participating in the Demand Response program as outlined by MLGW and is exploring ways to provide energy to the grid for the benefit of the community, especially in emergency situations or other times of need. As xAI grows, so will Memphis.

Pumping pollution into some of our poorest neighborhoods isn’t the growth we should be striving for in a city that already struggles with massive inequality.