A US regulator ruled on 15 January 2026 that Elon Musk’s artificial intelligence outfit acted illegally by using dozens of methane gas turbines to power massive data centres in Tennessee.
xAI has spent about 18 months fighting over truck-sized turbines parked near its Colossus 1 and 2 facilities, insisting they were exempt from air quality permits because they were temporary.
The Environmental Protection Agency declared the generators were not exempt, and it rewrote the playbook so that the whole temporary thing was spelt out. The agency said operating the machines still requires air permits even if they are portable or used on a temporary basis.
When xAI first installed the portable turbines at Colossus 1, it took advantage of a local county wrinkle that allowed generators to operate without a permit if they did not remain in one place for more than 364 days. At one point, up to 35 generators were powering Colossus 1, before xAI later received permits for 15 turbines and is now operating 12 permitted machines there.
Under the EPA’s ruling, permitting would fall under federal law, and no one has clearly stated what happens to firms that are still out of compliance.
Community activists in Memphis have been pushing back for as long as the turbines have been running, saying the data centre sits a few miles from historically Black neighbourhoods and piles pollution onto communities already taking a beating.
NAACP, director of environmental and climate justice Abre’ Conner said: “Our communities, air, water, and land are not playgrounds for billionaires chasing another buck,” after the organisation filed suit last July alleging the unpermitted turbines violate the Clean Air Act.
Methane gas turbines pump nitrogen oxides into the air, which are linked to cancer, asthma and other upper respiratory diseases. An EPA spokesperson told the Guardian: “The agency estimates the final action will result in the net annual [nitrogen oxide] emission reductions of up to 296 tons by 2032.”
For xAI, which makes the chatbot Grok, the turbines are presented as an extra source of power for its supercomputers. At full capacity, Colossus 1 uses 150 megawatts of electricity, and the company plans to expand.
Musk set up Colossus 1 in 122 days during summer 2024, then went even bigger with Colossus 2, reported as 1m sq ft, on the Memphis border in Southaven, Mississippi. A third xAI data centre in Southaven just got underway last week, and Musk posted that the supercomputer is named “MACROHARDRR” and will need nearly two gigawatts of computing power.
Colossus 2 is also powered by dozens of gas turbines, and Mississippi Today has reported 59 generators on site, with 18 treated as “temporary” without air permits.
Southern Environmental Law Centre, senior attorney Amanda Garcia said the EPA ruling “makes it clear that companies are not, and have never been, allowed to build and operate methane gas turbines without a permit and that there is no loophole that would allow corporations to set up unpermitted power plants”.
“We expect local health leaders to take swift action to ensure they are following federal law and to better protect neighbours from harmful air pollution,” Garcia added.
