While he is usually in the spotlight for his rockets or his political statements, Elon Musk is now facing serious environmental accusations. His artificial intelligence start-up, xAI, is at the heart of a scandal involving a clandestine gas-fired power plant in Memphis, Tennessee, used to run its powerful AI models. The project, called Colossus, could be in flagrant breach of US federal law on air quality.
A massive energy installation… without a permit
According to an investigation by the Southern Environmental Law Center (SELC), xAI has installed and commissioned at least 35 combustion turbines over the past year, without obtaining the required construction or operating permits. To date, 26 turbines are still in operation, along with three new, more powerful ones, bringing the site’s energy capacity to 407 MW – almost as much as at the peak of activity in March.
Aerial and thermal photography commissioned by SELC has confirmed continued activity at the site, despite public assurances that the turbines were “temporary”.
Invisible but toxic pollution
The problem goes far beyond the regulatory issue alone. In 2024, Memphis was designated the ‘asthma capital’ of the United States, due to its particularly high levels of air pollution. A 400 MW gas-fired power plant can emit more than 2,000 tonnes of nitrogen oxides (NOx) a year, compounds closely linked to smog formation and serious respiratory illnesses.
In an already vulnerable city, this undeclared industrial operation could therefore considerably worsen local public health.
The Chamber of Commerce tries to reassure… timidly
Faced with the controversy, the Greater Memphis Chamber of Commerce tried to defuse the situation. In a press release issued at the beginning of May, it stated that the turbines were temporary, until the data centre could be connected to the power grid. It promised that they would be phased out within two months, with the exception of those that would power a future Phase II of the project.
But these statements are not convincing either local residents or environmental organisations, who are denouncing a lack of transparency and excessive tolerance on the part of the local authorities towards a multi-billion dollar company.
A symbol of the excesses of the AI race
At a time when players such as OpenAI, Google and xAI are competing to design the most powerful AIs, the energy requirements of these infrastructures are reaching critical levels. The case of Colossus illustrates the potential pitfalls of this technological race: bypassing regulations, externalising environmental costs and endangering vulnerable populations.
Elon Musk’s Colossus project could well become a textbook case of the tensions between technological innovation, climate emergency and environmental justice. While the federal authorities are looking into the matter, the SELC is considering filing a formal complaint, which could result in heavy penalties against xAI. This is a case to keep an eye on, both for its legal implications and for the signal it sends out about the future of energy AI.
