The Tennessee Valley Authority (TVA) board of directors approved the request from Memphis Light, Gas & Water (MLGW) to power Elon Musk’s controversial xAI project during a meeting on Thursday.
TVA policy requires the board to approve any project that requires over 100 megawatts of power. According to the Southern Environmental Law Center (SELC), MLGW requested that (TVA) provide 150 megawatts of power to xAI. SELC said this demand is enough to power 100,000 homes.
Officials from TVA said this load is consistent with their wholesale power contract, and that xAI has agreed to specific demand response terms so that TVA and MLGW can provide power according to the requested timeline.
They added that xAI has “met or exceeded” conditions established by MLGW, including energy storage solution, recycled water solution, and positive community impact.
MLGW CEO Doug McGowen spoke with the TVA board Wednesday about an investment in the water cycling system to reduce reliance on the Memphis Sand Aquifer, TVA officials said.
When the project was announced, several groups asked city leaders to deny an electricity deal for the project and demanded a public review of the project. A letter from the SELC outlined community concern and condemned McGowen for approving an electricity deal.
“Recycled water from this system could also be used for cooling water supplying to our Allen Combined Cycle Plant and nearby industrial users – reducing aquifer usage by millions of gallons per day,” Dan Pratt, senior vice president of regional relations for TVA, said.
Board member Michelle Moore said both MLGW and the Memphis Chamber of Commerce told her of the importance of the xAI project as an economic development for the future of a “digital Delta.” Moore also said they heard from neighbors regarding pollution concerns, specifically on respiratory health.
“We have an obligation to serve our customers — MLGW serves xAI; our obligation is to serve, “ Jeff Lyash, president and CEO of TVA, said. “We can’t say no. We can say when and under what system conditions we can serve that load.”
Lyash went on to say that xAI has agreed to a demand response program that enables them to adjust their load, allowing TVA to approve the request.
“Because we don’t control it, I can’t speculate as to how they will use their generation in the future,” Lyash said. “Once their facilities are complete, then TVA in partnership with MLGW is in a position to supply 150 megawatts of low-cost, clean energy for this phase of their installation.”
In regards to the xAI’s supplemental water treatment facility, Lyash added that at this stage TVA is only aware of what the intent of the project is, and can’t see why it can’t be “brought to reality.”
“I think it’s exciting,” he said. “It’s the right environmental thing. If that facility is brought into reality and the water meets the requirements we need for the Allen Combined Cycle Plant, we would be excited about transitioning our facility to that source.”
The project has been condemned on several fronts from environmental groups to city leaders. Many have condemned the Chamber for its lack of transparency, specifically towards those in the Black community, and said its decision goes against the 17 principles of environmental justice.
“Construction and other industrial activities at Musk’s facility should be stopped until the community has been given a voice—through open processes conducted by state or local offices with authority over electricity planning (TVA), water system planning (MLGW), or environmental safety (TDEC),” the Southern Alliance for Clean Energy said in a statement. “Subverting or ignoring these processes has already led to public outcry, but the true downsides—weaker infrastructure and higher rates of pollution, illness, and other maladies—can still be avoided.”