The US Environmental Protection Agency (EPA) ruled on Thursday that Elon Musk's artificial intelligence company, xAI, had acted illegally by using dozens of methane gas turbines to power its data centres in Tennessee. The ruling is a victory for community activists in Memphis who have long opposed the unpermitted turbines, arguing they add pollution to already overburdened neighbourhoods.
xAI had argued that the truck-sized gas turbines parked near its Colossus 1 and 2 facilities were exempt from air quality permit requirements because they were portable or temporary. However, the EPA revised its policies, stating that operating such machines still requires air permits regardless of their portable nature. The agency estimates the final action will result in net annual nitrogen oxide emission reductions of up to 296 tons by 2032.
The Colossus 1 data centre, which houses xAI's chatbot Grok, initially used up to 35 portable turbines, taking advantage of a local county loophole allowing generator operation without permits for up to 364 days. xAI later obtained permits for 15 turbines and now operates 12 permitted machines at the site. Colossus 2, located in Southaven, Mississippi, has 59 generators, 18 of which are considered temporary and lack air quality permits.
Community activists and environmental groups, including the NAACP and the Southern Environmental Law Center, have filed lawsuits against xAI, alleging violations of the Clean Air Act. Methane gas turbines emit harmful nitrogen oxides linked to cancer, asthma, and respiratory diseases. The EPA's ruling clarifies that no loophole allows corporations to operate unpermitted power plants.
xAI plans to expand its data centre capacity, with Colossus 1 using 150 megawatts of electricity and a third facility, named MACROHARDRR, requiring nearly 2 gigawatts. The EPA has not yet specified how it will penalise non-compliant companies, and enforcement actions remain unclear.
