DOJ backs xAI in lawsuit over unpermitted gas turbines

The US Department of Justice sided with xAI on Monday in a lawsuit seeking to halt the company’s use of dozens of unpermitted natural gas turbines near its Memphis data centers, Wired reported. In a court memorandum, the DOJ argued that if the NAACP — which filed the suit in April — prevails, the outcome would undermine “American national, economic, and energy security by seeking to shut off the power supply for artificial-intelligence innovation that supports the Department of War’s military operations.” The memorandum said Grok is one of four AI models supporting “mission-critical operations,” including recent strikes in Iran.

The NAACP first signaled its intent to sue xAI last June, seeking to stop the company from running “mobile” gas turbines at its Colossus and Colossus 2 data centers. That campaign did not halt the buildout: those efforts failed, and Elon Musk’s company has since added more turbines, bringing the total to 57. Because the units remain mounted on trailers rather than permanently installed, xAI claims they are exempt from Mississippi air pollution regulations for one year. The Southern Environmental Law Center, which filed the suit on the NAACP’s behalf, argues the company’s use still violates federal law — law that states trailer-mounted turbines can be considered stationary sources and are therefore subject to regulation regardless of how they are mounted.

The NAACP says the surrounding region — already one of the most polluted in the country — has suffered worse air quality since xAI’s data centers went online. Since last year, the number of turbines at the data centers has more than doubled, alongside a corresponding increase in three major air pollutants: PM2.5, formaldehyde, and oxides of nitrogen (NOx). All three have been linked to asthma and cardiovascular disease. Formaldehyde exposure increases the risk of cancer, and PM2.5 has been implicated in a range of ailments, from stroke to Alzheimer’s disease.

xAI, now a division of SpaceX, is likely to buy more generators in the coming months or years. In its IPO filing, SpaceX disclosed that the company will buy another $2.8 billion worth of gas turbines to power its AI data centers over the next three years. Of that total, at least $2 billion is earmarked specifically for “mobile gas turbines” — the same category of equipment now at the center of the Memphis dispute.

Why it matters

The DOJ’s intervention shows Washington backing AI compute buildouts as a national-security priority even where environmental permitting is contested. With SpaceX now committing billions more to mobile turbines, the dispute over Memphis air quality is unlikely to be the last clash between gas-powered data-center growth and the permitting rules meant to govern it.