Musselwhite comments on xAI expanding operations to Southaven
Aug. 1, 2025 — Southaven is set to become a major player in the artificial intelligence industry as global tech company xAI announced plans to expand its operations into the city, marking a significant milestone for the region’s economic and technological future.
The announcement follows the 2024 launch of Colossus — the world’s largest supercomputer — which became operational on President’s Island in Memphis. Now, xAI has chosen to build on its success by expanding just south of the Tennessee line into Southaven’s industrial zone.
According to Southaven Mayor Darren Musselwhite in his Mayor’s Report blog post, the company will repurpose the long-vacant former Duke Energy facility to meet the growing energy demands of its AI operations. The site will be revitalized and outfitted with cutting-edge technology to support the next phase of xAI’s artificial intelligence infrastructure.
“This is a development of global magnitude,” Musselwhite said. “It will bring exponential benefits to Southaven, DeSoto County, Mississippi, and the entire Mid-South region.”
xAI’s current capital investment in Memphis totals several billion dollars, and similar investment levels are projected for Southaven. The initial phase of the project is expected to generate hundreds of new jobs, with the potential for continued growth as AI applications expand across industries.
The mayor emphasized the regional significance of the project, calling it a prime example of “regionalism at its finest,” and highlighting the broader community enhancements that are expected to follow.
While some in Memphis have raised environmental concerns related to AI data centers — including air pollution, power grid strain, and water usage — Musselwhite assured residents that Southaven’s partnership with xAI comes with a strong commitment to sustainability and public benefit.
“xAI has proven their commitment to being an outstanding corporate citizen in every possible way,” Musselwhite said.
The company plans to use Solar SMT-130 natural gas turbines equipped with SoLoNOx dry low emissions and selective catalytic reduction (SCR) systems, which achieve nitrogen oxide emissions as low as two parts per million — the lowest achievable rate in the United States. These turbines serve as backup generators and are designed to avoid placing any strain on the electrical grid during peak demand or emergencies.
xAI has also invested hundreds of millions in sustainable energy storage systems and partnered with utilities like Memphis Light, Gas and Water (MLGW) to build new substations and support regional power infrastructure. In terms of water use, the company has pledged to fund a new water recycling facility in Memphis and future infrastructure in Mississippi to avoid using water from natural aquifers.
Beyond its operational footprint, xAI has committed to investing in transportation infrastructure and education in the communities where it operates — with a focus on preparing local students for careers in technology.
“Southaven has been blessed with great economic success over the years and we currently have tremendous economic demand,” Musselwhite said. “But listen to me — this is a big one!”
The xAI expansion positions Southaven at the forefront of the global AI revolution and marks a significant step toward long-term economic transformation for the Mid-South.
