Power expected to be available at xAI’s Memphis facility in a month as city council questions project

MEMPHIS, Tenn. (WMC) - Memphis City Council members hit Memphis Light, Gas, and Water (MLGW) President and CEO Doug McGowen with many questions Tuesday regarding Elon Musk’s xAI moving into Memphis.

Many of the questions dealt with how the supercomputer will impact MLGW’s day-to-day operations, grid and water supply.

McGowen said those operations would not be impacted by xAI and compared the company’s arrival to the ordinary addition of a new customer.

Many council members expressed frustration with McGowen’s update.

“You all have been dealing with this information for a long time, we are just getting it, we heard about it in the news, and it’s here,” said Councilwoman Rhonda Logan.

McGowen said the xAI supercomputer is planned to open at the former Electrolux building. It will use over 150 megawatts (MW) of power, 50 of which will be available to the facility by August 1 by MLGW’s existing substation near the facility.

Another 150 MW will come from a substation built by xAI, but that process still has to be approved by the Tennessee Valley Authority Board, according to McGowen.

“We are just interested in providing the power, water, and gas that they need. I know the timeline for that. I know that we will have the first 50 megawatts of power available to them by the first of August,” he said.

Right now, xAI and TVA are negotiating a Demand Response program contract. This program would require xAI to temporarily reduce its power consumption during high-demand periods. McGowen said this is just one of the ways the utility is working to protect the power grid.

“It’s something that is being negotiated by the Tennessee Valley Authority and xAI, and I believe it is going to be contingent on their ability to get the 150 megawatts... that they agree to participate in the demand response program,” he said.

McGowen said he understands concerns from the council with this fast-moving project but said adding a new customer is not an issue for them.

“Just the addition of that customer is not going to put the grid at risk. What you heard some of the council members was frustration with day-to-day reliability,” said McGowen. “But it doesn’t have to do with the number of customers; it has to do with the distribution system, some of the old infrastructure in the distribution system.”

Some council members were still weary about what happens next, especially after recent power outages.

“And you all are just, ‘Okay, no problems,’ but we can’t get good electricity on a good day, with no wind,” said Councilwoman Yolanda Cooper-Sutton.

TVA, EDGE, and governing bodies still need to provide approvals for xAI, according to the Greater Memphis Chamber.

There are about eight jobs posted on xAI’s website for openings at the location in Memphis.

Those include an engineer, fiber technician, and superintendent, and all the positions require a lot of skill. According to xAI’s website, the company is offering anywhere from $100 to $200 an hour for these positions.

At the end of the committee meeting, Memphis City Council members still had questions. They asked McGowen for another meeting to discuss xAI and asked for community forums to be held so residents can ask questions as well.

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