Elon Musk’s xAI is accelerating construction of its Colossus II supercomputer in Memphis with over $375 million worth of Tesla Megapacks. These battery systems will power the facility and support growing AI infrastructure demands. The deployment highlights the integration of advanced energy storage in AI data centers.
xAI is ramping up work on its Colossus II supercomputer cluster at a one-million-square-foot facility in Memphis, Tennessee, which the company purchased earlier this year. To meet the project's substantial power needs, xAI plans to install more than $375 million worth of Tesla Megapacks on-site.
In a recent post on X from the official xAI Memphis account (@xAIMemphis), the company announced: “On site this week we continue to welcome the arrival of Tesla Megapacks! These Megapack batteries are large scale, containerized lithium-ion battery systems designed by Tesla for utility-scale and commercial energy storage.” The post added that the systems “will allow our xAI data centers to grow.”
Tesla’s Megapack serves as the company’s flagship utility-grade energy storage solution, designed for grid-scale deployment. Each unit can store large amounts of energy and dispatch it dynamically to stabilize demand, smooth fluctuations, and integrate renewable sources such as solar and wind into the grid. The technology has gained global adoption for major energy projects. For instance, Tesla secured a $2.7 billion Megapack order from Georgia Power in August. More recently, Tesla introduced Megapack 3, which stores 5 MWh of usable AC energy per unit and features a new architecture to enhance installation speed, efficiency, and long-term reliability.
Once operational, the Colossus II cluster will use the Megapack array for energy storage and to stabilize local power supply, addressing the strain AI supercomputers place on electrical grids. xAI states that the system will “protect and often improve power reliability, cost and cleanliness” for nearby residents. This initiative represents one of the largest single-site uses of Tesla’s grid-scale storage technology and underscores Tennessee’s emerging importance in the U.S. AI and data center landscape.