xAI Marks Its Spot in Memphis

xAI is a private company founded by Elon Musk. It is globally recognized as one of the most valuable artificial intelligence companies and is currently valued at $80 billion (as of March 2025). 

The supercomputer is located at Frank C. Pidgeon Industrial Park in Southwest Memphis. xAI has four Memphis sites- one fully operational, one for sustainability efforts, one under construction for core operations, and one for the Colossus Water Recycling Plant.

xAI has planted its roots in Memphis and intends to continue to expand their footprint in the city. They want to be recognized as a Memphis-based company and a cornerstone to the city.

xAI will bring up to 500 quality, high-paying jobs to Memphis in its initial phase, with plans to grow more.

There are several benefits to xAI being in Memphis. With Colossus being housed here, we are now actively competing in the AI race with major global tech hubs. With the presence of xAI, up to 500 jobs will be added and their investment in our city will continue to create quality, high paying jobs. It is expected to attract other major AI and technology companies which will further position Memphis as the Digital Delta and grow our local economy.

Memphis is xAI’s home too, and xAI wants to do their part to provide the best opportunities possible for the community.  xAI only arrived in Memphis in March 2024 and has already paid tens of millions of dollars in local tax revenue, and based on current expansion plans, that number is likely to exceed $100 million by next year.

From the get-go, xAI began working closely with Memphis companies. With xAI’s presence in Memphis, the opportunities are endless. They are helping further the Digital Delta and creating an AI ecosystem that can lead to knowledge sharing and innovation. Now, they have a portal for local vendors to send RFP submissions.

No. From the start, xAI trucked in water which it recycled through an internal closed-loop system in order to cool the supercomputer. 

xAI has committed to build a $80 million wastewater recycling facility that will allow the company to continue to use recycled water for industrial uses while also providing the same opportunity for other major industrial users of aquifer water. This wastewater facility will be the first in Memphis history and will have the capacity to ensure that up to 4.7 billion gallons of water remain in the aquifer yearly, roughly 9% of the load.

The short answer is “no.” The natural gas turbines being used by xAI are natural gas-fired combustion turbines. Natural gas is a clean burning fuel and is championed by multiple groups over alternatives such as fuel oil (diesel) and for large power plants, coal.  The U.S. Environmental Protection Agency (EPA) requires that stationary natural gas fired turbines do not exceed 25 ppm (parts per million) nitrogen oxides (NOx) emissions in exhaust. (New Source Performance Standards Subpart KKKK – Standards of Performance for Stationary Combustion Turbines) or NSPS KKKK for short.

The stationary natural gas fired turbines that are being permitted for xAI will be equipped with control technology that results in 2ppm for NOx which represents a 92% decrease in emissions below what is required by the EPA under NSPS KKKK. These turbines will also control CO to 2.5 ppm and volatile organic compounds (VOCs) to 2 ppm. Formaldehyde is included with VOCs. In short, these natural gas fired turbines represent the lowest achievable emission rate (LAER), dramatically exceeding any gas turbines with respect to emissions currently operating in the United States (even in California). The company responsible for the turbines has shared that the level of control for the turbines “exceeds the control anywhere else in the US” and constitutes Best Available Control Technology (BACT).

xAI is using natural gas turbines to temporarily power the supercomputer as an alternative to using the Memphis power grid, ensuring that the supercomputer never jeopardizes citizens’ access to power. Natural gas is a clean-burning fuel and is championed by multiple groups over alternatives such as fuel oil (diesel) and for large power plants, coal.

The Solar SMT-130 turbines will be equipped with SoLoNOx dry low emissions (DLE) technology and selective catalytic reduction (SCR) systems that lower nitrogen oxides (NOx) to 2 ppm.  That emission rate is the Lowest Achievable Emission Rate which will make xAI the lowest emitting facility in the country.

In the early testing stages, xAI leaders were concerned about how the electrical grid would react to these dynamic fluctuations in power. By temporarily generating their own power needs, the grid was not subjected to these swings in demand and response. In addition, xAI utilizes high-capacity battery storage units to store power during off-peak hours that can be provided back to the grid in times of high demand by the grid. The gas turbines have allowed xAI to power its own operations with minimal risk to the power needs of the average citizen.

xAI will take no power from the grid during emergencies or when the grid is strained so that all available power is going to the community. xAI agreed to this in a contract with TVA and MLGW. Furthermore, xAI has spent $35 million to construct a substation to support MLGW and is committing an additional $20 million to build another substation. xAI has made a large investment in sustainable energy storage systems, including spending hundreds of millions of dollars on installing over 240 batteries. They are even exploring ways with MLGW & TVA that they can provide additional energy to the grid for the community.

xAI is leasing 552 acres of land in Frank C. Pidgeon Industrial Park. They plan to use this land to expand their footprint in Memphis. Developing the site will be a multi-year project. They bought an additional site for the Colossus Water Recycling Plant. 

xAI chose Memphis because of its reliable power grid, ability to create a water recycling facility, proximity to the Mississippi (River) and ample land. Furthermore, xAI experienced unprecedented effective collaboration from local entities including MLGW, TVA, City of Memphis and Shelby County which demonstrated Memphis’ pro-business climate. xAI benefitted from the Greater Memphis Chamber’s leadership in driving partnership and collaboration with MLGW, TVA, and other critical partners. They chose Memphis because of the speed at which we were able to do business and create impactful solutions. xAI took no incentives from the State to plant their roots in Memphis.

Once fully operational, Colossus will use 300 megawatts of power.

Artificial Intelligence, or AI, is advanced technology that allows machines to perform tasks such as processing information, recognizing patterns, and making decisions.

Colossus went live August 8, 2024—just 122 days after the announcement.

AI obtains its information through training on extensive data sets from various mediums including: books, websites, social media and other data sources. During operation, AI uses real-time data to continue to update its information and fine-tune its outputs.

A supercomputer is a high-speed and high-functioning computer system capable of performing tasks faster than regular computers. Think of it like a brain intaking, processing, and outputting information. A supercomputer can solve complex problems at the speed of light. It’s the smartest, fastest problem-solver in the world.

Colossus is the most powerful supercomputer in the world hosted in Southwest Memphis. It is also known as the Gigafactory of Compute.  Colossus runs on 100,000 Nvidia H100 chips as of September 3, 2024 and 200,000 as of December 4, 2024. xAi has plans to expand to 1 million GPUs. 

With a data center, information only goes in. The supercomputer is like a brain where the information goes in and out.

Nvidia chips are a graphic-processing unit (GPU) model and are commonly used in the AI and advanced technology industry. 

xAI’s supercomputer, Colossus, is powering Grok and training it, meaning it is continually providing it with information. The information comes from X and other internet sources.

Grok is xAI’s AI model chatbot. It is housed in the social media platform, X, and is a truth-seeking chatbot with the mission of understanding the universe. The supercomputer is powering Grok.