Elon Musk is trying to convince organizations in Memphis to place the "Gigafactory of Compute" supercomputer but faces many barriers.
"It took Elon Musk about a week to decide to build a supercomputer for xAI in Memphis," Ted Townsend, President of the Greater Memphis Chamber - a non-profit organization for economic growth for the Memphis area, told Forbes. xAI company was founded by Musk last July, competing directly with OpenAI and Microsoft.
According to Townsend, after a few days of quick negotiations in March, Elon Musk's team, including representatives of some of the companies he is running, chose Memphis, Tennessee, because of its access to abundant electricity and capacity. Build quickly. The project is codenamed Project Colossus, inspired by the 1970s movie Colossus: The Forbin Project, about an AI given control of the US nuclear arsenal.
However, some Memphis City Council members and environmental organizations oppose Musk's plan while residents are concerned about problems with the data center once it is operational. "Everyone is scared about what could happen to our water and energy supplies," Councilwoman Pearl Walker said at the Memphis Light, Gas & Water (MLGW) meeting on July 18.
Find every constructive way
Some sources revealed to Forbes that after reaching a secret agreement in March, Musk wanted to build a "Gigafactory of Compute" supercomputer immediately to train AI Grok. He even caused a reaction from Tesla shareholders when he switched the electric car company's GPU shipments to xAI. The new generation of Grok is said to require training using 100,000 Nvidia H100 chips.
In May, Musk said he would personally ensure the development of the supercomputer on schedule. According to The Information, Musk and xAI approached Memphis and 7-8 other locations for data centers before making a decision. When Memphis was chosen, Musk's team invited some officials here to the Tesla factory in Texas. According to Townsend, the American billionaire sought to convince them with promises that xAI would improve Memphis' public infrastructure, such as building an electrical substation and a new water treatment facility even though these two infrastructures not covered by the contract, will then "give the keys back to the city".
However, some Memphis city council members were reportedly left out of the decision-making process. "This has already happened, and we still don't know anything," member Rhonda Logan said about Musk's supercomputer project during a meeting in the city in early July.
Meanwhile, not everyone believes Musk's promise. According to LaTricea Adams, a White House environmental adviser who was born in Memphis, Musk has a long history of promising to develop public infrastructure but not delivering. For example, in 2018, the billionaire's Boring Company said it would build a bypass to reduce congestion in Chicago, in addition to the "hyperloop" tunnel system, but so far everything has not yet taken shape, most of the content promised. has been removed from the company website.
Last month, the Memphis Chamber of Commerce publicly announced the location of xAI's data center, a former factory once owned by appliance maker Electrolux. This is a land that has long been abandoned and lacks public amenities.
A series of concerns
Townsend estimates the deal will be good for Memphis. Council members will receive more details about the project next week "in closed session," but others appeared worried.
"The people of Memphis deserve answers, possibly a public meeting within the next two weeks," Adams wrote on X on July 16. "We cannot welcome a project that goes against the city's public processes."
According to calculations, cooling the data center is expected to require 1.3 million gallons of water per day from the Memphis Aquifer, the city's main water source. This is less than Memphis' consumption of 150 million gallons per day and could be reduced if xAI builds a revolving refinery. However, in the immediate future, a certain amount of water will be shared with Musk's company.
Energy issues also cause anxiety, especially persistent questions about how much power Musk's supercomputer will be allowed to draw from the public grid. In recent years, the city has asked people to reduce their usage, as well as rotate power cuts to avoid overloading the power grid.
According to MLGW calculations, xAI's supercomputer can initially consume 50 MW of electricity per day, equivalent to the amount of electricity supplying 50,000 homes. Meanwhile, Musk's company is said to have requested 130-150 MW of electricity, or three times more. "We need to consider how a company using such a huge amount of energy will impact people's lives," an MLGW representative said at a meeting in front of the city on July 18.
Musk's companies have previously received billions of dollars in tax incentives from states, cities and towns if they built factories in that location. In Memphis, xAI does not receive tax incentives, or at least not yet. However, the city council appears to be facilitating xAI despite objections.
Previously, according to Reuters, Musk was building two parallel supercomputer clusters for Tesla and xAI startup, both worth billions of dollars. If the connection of 100,000 H100 GPUs is completed, this will be the most powerful supercomputer in the world, four times larger than the largest GPU cluster today.
xAI and Musk have not yet commented. However, in an article on X on July 22, the American billionaire said that the realization of supercomputers has made the first progress: "The xAI, the company supports participating in the Memphis Supercluster training that began at 4:20 a.m. local time. With 100,000 liquid-cooled H100 GPUs on a single RDMA fabric, it is the most powerful AI training cluster in the world. !".