The Colossus data center operated by xAI outside of Memphis is facing a lawsuit for operating a fleet of natural gas turbines without permits.
“Over the past year, xAI has installed and operated at least 35 combustion turbines and other sources of air pollution at the Colossus site without ever obtaining the necessary preconstruction or operating air permits,” the Southern Environmental Law Center (SELC) wrote in a letter to xAI.
The legal group submitted the letter on behalf of the NAACP. It serves as a notice for intent to sue xAI for violations of the Clean Air Act. The law requires organizations to submit such a letter 60 days in advance of filing a lawsuit.
The gas turbines have the potential to emit more than 2,000 tons of NOx per year, a group of chemicals that contribute to smog.
Memphis already “had some of the worst air quality in the region,” SELC notes. “In 2024, Memphis was deemed an asthma capital of the nation by the Asthma and Allergy Foundation of America due to high rates of emergency room visits and deaths from asthma.”
SELC alleges that xAI failed to obtain permits required by both the federal and local regulators before installing the generators. It also alleges that the company wasn’t operating them with proper air pollution controls. At one point, xAI had enough turbines to generate 421 megawatts of electricity.
Last summer, the Shelby County Health Department (SCHD), which oversees local air pollution compliance, “told reporters that xAI’s turbines were exempt from permitting, although SCHD still had not disclosed publicly what xAI was operating on its site nor the legal basis for any such exemption,” SELC said.
To determine what was happening at the Colossus site, SELC paid an aerial photographer to capture images of the facility in March. The photos revealed that xAI had installed 35 turbines around the perimeter of the data center at the time. Thermal images taken about a month later showed that at least 33 of them were operational, SELC said.
After those images were taken, the Greater Memphis Chamber, a local economic development agency, said that xAI had removed some of the turbines.
“The temporary natural gas turbines that were being used to power the Phase I GPUs prior to grid connection are now being demobilized and will be removed from the site over the next two months,” the Memphis Chamber said. “About half of the operating turbines will remain” until a second substation completes the data center’s connection to the grid, the organization added, and that once the substation was complete, the turbines would serve as backups.
But a flight on June 15 showed that at least 26 turbines remained, including three new ones that had been installed since the April flight. The total generating capacity was around 407 megawatts, just 14 megawatts shy of the previous amount.
“With very few exceptions — none of which apply here — new sources of criteria and other air pollutants in Tennessee must obtain preconstruction approval in the form of an air permit as well as a permit to operate and emit pollutants,” SELC said.