SpaceX’s AI division xAI announced plans to buy $2.8 billion in gas turbines for its data center infrastructure over the next three years, including a $2 billion deal for mobile gas turbines still pending finalization as of April 2026 [1, 2].
xAI currently operates 46 portable gas turbines at data centers in Memphis, Tennessee, and Southaven, Mississippi, branded Colossus 1 and Colossus 2 [1, 2]. However, the company only holds permits for 15 of these turbines, prompting the NAACP to file a lawsuit last month citing pollution concerns in a heavily affected area [1, 2].
Each turbine can emit more than 2,000 tons of nitrogen oxides annually, pollutants linked to smog and asthma [1]. xAI claims these turbines qualify as mobile units on trailers and can operate for up to a year without permits. Federal EPA regulations hold otherwise, ruling earlier this year that xAI violated air pollution laws [1].
In its IPO filing, SpaceX acknowledged significant dependence on natural gas and turbine technology for its data centers, warning that permit restrictions could hurt its AI business [1]. Wired described portable turbines as quick, temporary power solutions until more robust energy sources become available [2].
xAI leases server access at the Colossus centers to AI company Anthropic for $15 billion annually. The AI division posted a $6.4 billion operating loss in 2025 on $3.2 billion revenue according to filings [3, 2]. It plans to scale its Grok AI platform to multiple trillions of parameters, demanding significant compute and capital [3]. As of March 2026, Grok AI had 117 million monthly active users out of 550 million total across Grok and SpaceX’s X platform [3].
xAI’s turbine purchases include $805 million in turbines agreed in March 2026, with new deals extending through 2029 [2]. The company must now address pending legal actions and regulatory rulings while continuing its aggressive expansion.
