By Laura Paddison, Rene Marsh, CNN
(CNN) — Last summer, an abandoned factory in southwest Memphis got a new life courtesy of the world’s richest man. Elon Musk’s artificial intelligence company xAI moved in to transform this unprepossessing building into the “world’s largest supercomputer.”
Musk named it Colossus and said it was the “most powerful AI training system in the world.” It was sold locally as a source of jobs, tax dollars and a key addition to the “Digital Delta” — the move to make Memphis a hotspot for advanced technology.
“This is just the beginning,” xAI said on its website; the company already has plans for a second facility in the city.
But for some residents in nearby Boxtown, a majority Black, economically-disadvantaged community that has long endured industrial pollution, xAI’s facility represents yet another threat to their health.
AI is immensely power-hungry, and Musk’s company installed dozens of gas-powered turbines, known to produce a cocktail of toxic pollutants. The company currently has no air permits, appearing to rely on a loophole for temporary turbines — but environmental groups say the exemption does not apply, and residents are angry.
“Our health was never considered, the safety of our communities was never, ever considered,” said Sarah Gladney, who lives 3 miles from the facility and suffers from a lung condition.
xAI did not respond to CNN’s requests for comment.
This part of Memphis, home to 17 other polluting facilities — including an oil refinery, steel plant and gas-fired power plant — is used to fighting for clean air.
This time, however, not only are they up against the world’s richest man, who happens to be one of President Donald Trump’s closest advisors, but it’s happening as the Trump administration takes an ax to pollution legislation, slashes environmental justice programs and throws its full-throated support behind AI.
What’s unfolding in Memphis should be a warning to other communities, said Erika Sugarmon, a commissioner of Shelby County, which encompasses Memphis and the surrounding area. “All these different safeguards are being taken away,” she told CNN. “So where do you go?”
The race for AI
The new Memphis facility is part of Musk’s quest to dominate AI, providing computing power to xAI’s chatbot, Grok, which the company promotes as an “anti-woke” version of OpenAI’s ChatGPT. It has been under fire for loose guardrails, including allowing users to create Nazi Mickey Mouse images.
Memphis Mayor Paul Young has thrown his support behind xAI’s arrival, emphasizing benefits including the promise of hundreds of high-paying jobs and around $30 million in tax revenues in the first year alone.
“What we are looking at is an opportunity to completely transform our economy,” Young said. It’s “game changing,” he told CNN.
Others see it very differently.
Some local lawmakers say they were kept in the dark about the facility’s arrival, leaving them scrambling for information.
State Rep. Justin Pearson, a Democrat who lives 3 miles from the facility, said he was blindsided. His initial concern was how it would be powered. “Our grid is already not stable enough” and the last three winters have seen rolling blackouts, he told CNN.
It turned out the answer is partly grid power. The facility receives 150 megawatts from the local public utility Memphis Light, Gas and Water — enough to power around 100,000 homes. MLGW said it had done an impact study to ensure this would not affect power availability and reliability for consumers. xAI is now awaiting approval for a further 150 megawatts.
But what really spiked Pearson’s concerns were the turbines that started appearing at the facility last summer.
Gas-powered turbines produce pollutants, including nitrogen oxides, a key component of ozone pollution — also called smog — which can cause asthma attacks and chest pain and, in the longer-term, is linked to decreased lung function and premature death.
They also generate the carcinogen formaldehyde and tiny air pollution particles so small they can pass through lungs into people’s bloodstream.
It’s a big concern for a region already grappling with the impacts of air pollution. The cancer risk from industrial sources in southwest Memphis is 4.1 times higher than the EPA’s acceptable risk, according to a ProPublica analysis. Shelby county has an F in air quality for ozone levels from the American Lung Association and the highest rates of children hospitalized for asthma in Tennessee.
Aerial images taken by the Southern Environmental Law Center and South Wings, an organization of volunteer pilots, in March showed xAI had 35 turbines at the facility.
These can generate a total of 420 megawatts, equivalent to a “medium- to large-sized power plant,” said Patrick Anderson, a senior attorney at SELC. They can produce an up to 2,000 tons of nitrogen oxide pollution every year, which would make xAI one of the biggest sources in the county, according to SELC calculations.
Aerial pictures taken in April, this time with a thermal imaging camera, showed 33 turbines were producing heat, suggesting they were operating, Anderson told CNN.
What has inflamed the community further is xAI’s lack of air permits.
It appears the company relied on a loophole which allows temporary turbines in one location for less than a year to operate without a permit.
The SELC, however, argues xAI’s turbines don’t fall within a permit exemption because of their size and the pollution they produce. “Our position is (xAI is) without a permit, they should not be operating,” Anderson said.
In January, months after starting operations, xAI applied to the Shelby County Health Department for permits for 15 turbines. A health department spokesperson told CNN the application was currently under review and all community feedback would be “carefully considered.”
Twelve of the remaining 20 turbines were removed in May, and the rest will go in the future, said Mayor Young, although the timeline is unclear.
The Greater Memphis Chamber of Commerce said the turbines for which permits have been requested “will achieve industry-leading emission standards” once they are equipped with pollution reduction technologies.
For Rep. Pearson, however, the situation is bewildering. “It’s an actual gas plant in the middle of a neighborhood and you don’t need any permitting?” he said. “Something has failed drastically and significantly with our system of checks and balances.”
‘Not a new fight’
Some of xAI’s supporters have accused those who oppose it of being motivated by animosity toward Musk.
It’s a theory rejected by KeShaun Pearson, director of Memphis Community Against Pollution. Southwest Memphis has a long history of battling for clean air, soil and water, he told CNN.
Residents successfully fought off a crude oil pipeline in 2021 that would have crossed Boxtown and multiple other predominantly Black communities in southwest Memphis.
A medical sterilizing facility in south Memphis, which since the 1970s had been pumping out ethylene oxide, a toxic pollutant linked to blood and breast cancers, closed in 2023 after local campaigning.
xAI’s facility “is not a new fight; this is the most recent,” Pearson said. Southwest Memphis has long been seen as a “sacrifice zone,” he added.
Pearson is wary of promises of hundreds of highly-paid jobs; data centers don’t typically need large numbers of workers. He fears the majority of roles available to local people will be in janitorial and security.
xAI’s taxes also won’t make up for health impacts, said Pearson, whose grandparents both died of cancer in their 60s, losses he blames on long-term pollution.
What’s happening in southwest Memphis reveals the tension between two very different narratives of what AI can bring US communities.
For some leaders and business groups, xAI offers an opportunity to bring investment to an area in desperate need. Young people will be trained for AI jobs, and xAI tax dollars will be reinvested in the community, including tackling indoor air pollution, Mayor Young said.
For environmental groups and many residents, this much-hyped, new technology brings the same old problems. “If the innovation shackles you to fossil fuels like methane gas or coal, that’s regression, right? That’s not progress,” Pearson said.
There could be a rash of similar power-hungry data centers appearing across the US as Trump and tech companies pave the way for AI. The EPA has listed making the US the AI “capital of the world” as one of the five pillars guiding its work.
An EPA spokesperson told CNN “the Trump EPA will continue to implement its core mission of protecting human health and the environment while Powering the Great American Comeback” but did not answer specific questions about the xAI facility.
Rep. Pearson fears for the impacts. “If you look at where these data centers are propping up, it’s always in poor communities” he said. There is “no hope” the federal government will help protect them, he added.
In southwest Memphis, the fight for clean air will continue, especially as xAI looks to expand its footprint with a new 1 million-square-foot facility. But it’s exhausting, said Boxtown resident Sarah Gladney. “It seems like we are constantly at battle,” she said.
“We deserve to breathe clean air.”
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