xAI Faces Environmental Lawsuit Over Alleged Disproportionate Pollution

Elon Musk’s AI company, xAI, is facing potential legal action over alleged air pollution violations at its Memphis-based “Colossus” data center.

On Tuesday, the Southern Environmental Law Center (SELC) issued a 60-day notice of intent to sue the firm for violating the Clean Air Act.

The notice, filed on behalf of the National Association for the Advancement of Coloured People (NAACP), the nation’s oldest civil rights organisation, claims xAI installed and operated dozens of gas-fired turbines without proper air quality permits.

The notice reads:

“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.”

Rather than wait for a connection to the local power grid, xAI reportedly deployed the turbines to power the facility—an approach SELC argues has resulted in the emission of hazardous pollutants, including nitrogen oxides and formaldehyde.

SELC senior attorney Patrick Anderson stated:

“We have on four different occasions sent formal requests to the local health department asking for them to use their authority to enforce the law. Obviously, that hasn’t happened.”

These emissions, the notice alleges, not only breach federal environmental law but also fail to comply with mandatory pollution controls, such as the installation of selective catalytic reduction systems required under the Clean Air Act.

The Colossus facility sits on the site of a former electronics plant in South Memphis, near the historically Black neighbourhood of Boxtown—an area already burdened by industrial pollution and long-standing air quality concerns.

The NAACP posted on X (formerly known as Twitter):

“We are prepared to combat environmental racism at every turn.”

The NAACP is seeking injunctive relief, civil penalties, attorney’s fees, and litigation costs, arguing that the project poses a serious threat to public health and environmental justice in the surrounding community.

Data Center Growth Accelerates

Musk’s xAI is already planning a second, even larger data center in Memphis—dubbed Colossus 2—which is expected to require at least 1 gigawatt of power to operate.

The project reflects the broader surge in demand for data infrastructure, fuelled primarily by the rapid expansion of AI and cloud computing.

According to projections from the US Department of Energy, national data center energy consumption could double or even triple by 2028.

Meeting this global demand will not come cheap: research from McKinsey, published in May, estimates that $6.7 trillion in investment will be needed by 2030 to support the scale and speed of data center growth worldwide.

Nick Ruck, director at LVRG Research, said:

“AI’s record-shattering demand is finding limitations in the supply of data centers and electricity as AI companies struggle to reach profitability amid mounting costs. Institutions estimate AI will drive a 165% increase in the demand for data centers by 2030.”