Elon Musk’s A.I. Ambition Faces Environmental Scrutiny

Multiple environmental groups in Memphis, Tenn. said a recently opened data center operated by Elon Musk’s xAI is contributing to the city’s already dire smog problem. The groups claimed that xAI’s use of gas turbines, which power the supercomputing facility, lacks proper permits and will only aggravate the city’s poor air quality. Such issues aren’t out of the ordinary for Musk, whose other companies have previously faced environmental scrutiny.

Musk, who is CEO of SpaceX, Tesla (TSLA) and The Boring Company, established xAI last year and raised $6 billion for the startup in May. Its primary product thus far is Grok, a chatbot that claims to be able to express more humor and less political correctness than rivals like OpenAI’s ChatGPT. To develop and train next-generation Grok models, Musk in June announced plans to open a data center in a former manufacturing facility in Memphis. Housing 100,000 of Nvidia (NVDA)’s H100 graphics processing units (GPUs), xAI’s data center can accommodate 50 megawatts of power from the municipal utility Memphis Light, Gas and Water (MLGW) and plans to eventually expand this capacity to 150 megawatts.

The facility currently generates power using gas combustion turbines. xAI has installed at least 18 gas turbines but failed to obtain the required air permits for them, according to a letter sent this week by the Southern Environmental Law Center (SELC) on behalf of four climate groups to the Shelby County Health Department, which counts Memphis among its cities.

“South Memphis has been overburdened by industrial pollution for decades, and turning a blind eye to unpermitted gas turbines at the xAI facility is only going to continue the long legacy of environmental injustice in these predominantly Black communities,” said Amanda Garcia, an attorney for SELC, in a statement shared with Observer. “We are urging health officials to investigate these turbines and take necessary action in order to help Memphians breathe easier.”

SELC, which claims that xAI’s turbines don’t meet permit exemption criteria, noted that the startup’s turbines have the capacity to emit 130 tons of nitrogen oxides (NOx). This would make them the 9th largest source of NOx, a pollutant that contributes to smog, in Shelby County. The region already has a longstanding smog issue and was graded “F” by the American Lung Association for its air quality. “In other words, Memphis residents currently breathe unhealthy air, and the problem is worsening,” said the group’s letter.

The organization has not yet received a response from the health department, according to SELC. xAI did not respond to requests for comment.

Elon Musk’s companies have a history with environmental groups

This isn’t the first time one of Musk’s projects has faced environmental pushback. The Boring Company, his tunneling venture, has received numerous violations linked to its development sites in Bastrop County, Texas. Citations from the Texas Commission on Environmental Quality (TCEQ) claim the company has failed to minimize its discharge of pollutants in truck washout water, among other violations.

SpaceX has also received violations from the TCEQ regarding pollutants in discharged wastewater released near Boca Chica, Texas, where its Starbase development center is located. And earlier this year, Tesla was sued by a climate nonprofit for allegedly emitting pollutants since 2021 through its paint shop operations in Fremont, Calif.

When it comes to the concerning environmental impacts of A.I. data centers, xAI isn’t alone. Greenhouse gas emissions have soared as Big Tech races to develop the facilities powering their models, which are expected to consume vast amounts of energy to keep up with demand. Data centers, which currently consume 1 percent to 2 percent of global power, could see this figure increase to 3 percent to 4 percent by the end of the decade and more than double their carbon dioxide emissions during that time, according to Goldman Sachs researchers. Google (GOOGL)’s greenhouse gas emissions, for example, rose 48 percent between 2019 and 2023, while Microsoft (MSFT)’s have soared by 29 percent since 2020.