Elon Musk Appears Ready To Use Massive Electricity Supply

Markus Winkler Pexels

Elon Musk already runs one of the largest AI companies in America, called xAI. It may be a near second to Microsoft, Meta, OpenAI, and Amazon, but not by much. He is about to raise $20 billion, which would take the value of what has become known as XAI (He has merged with social media company X). The new private value is forecast to be $140 billion.

All AI companies are electricity-hungry. XAI’s investment capital will almost certainly be used to build huge server farms. Musk already owns a massive one just outside Memphis.

Server Farm In Memphis

The challenge with AI server farms is that there is a scarcity in America to supply them. One estimate is that AI will use as much electricity as the entire nation of Japan in 2026. 

AI electricity needs have strained the grid and supply, just as Bitcoin mining and air conditioning also need greater supply. 

The electricity supply problem is a puzzle without a solution. Renewable energy has grown as a source of supply, but solar energy is not growing fast enough; Trump Administration constraints are challenging wind energy, and new nuclear plants will take years to approve and build. That leaves natural gas and coal the greatest polluters of all fossil fuels. 

The Weak Grid

The current electricity grid has sections that are fifty years old and would need to be upgraded or replaced. This would be well into the tens of billions of dollars. Utilities cannot raise that money, and the government appears unwilling to underwrite it.

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