As Elon Musk’s xAI supercomputer rankles Memphis, Nashville looks to regulate data centers

As data centers continue to be developed around Nashville, local leaders are looking into new regulations.

The Metro Council will begin considering legislation next week that would restrict some types of data centers in Nashville.

Data centers are physical facilities that house massive amounts of computer servers. While they are not new, their scale has exploded in recent years to support the advancement of artificial intelligence. The facilities consume enormous amounts of power. They typically purchase energy from the local electrical grid, or use their own self-generated, “behind-the-meter” supply. They also often maintain their own backup generators.

Some projects have been met with opposition over possible pollution, water usage and potential electricity cost increases. In Memphis, residents living near Elon Musk’s xAI facility, called ‘Colossus,’ say it is spewing significant amounts of air pollution.

More: Tennessee has 60 data centers. Nashville probably has more than you think.

Right now, there are 60 such centers in Tennessee, with 13 (operational and under construction) facilities located within Davidson County. Just last week, the Nashville Business Journal reported an Atlanta-based developer is looking to demolish two buildings and build a new center near the Nashville Zoo.

Currently, Metro has no restrictions in place regarding where such facilities can be built or how they can be operated.

The city’s mayor told This Is Nashville this week that he’s “keeping an eye” on the situation.

“The biggest three things that are concerns and considerations here tend to be access to electricity, access to water, and then is there any pollution source associated with it,” O’Connell said. “We’re going to make sure this doesn’t create pressure for ratepayers and isn’t going to create harmful side effects.”

Meanwhile, Councilmember Rollin Horton, who also chairs the Planning and Zoning Committee, introduced a zoning bill to restrict massive data centers.

“We’ve seen a lot of problems with data centers — both here in Tennessee and across the country — and a lot of the costs that those impose both on the environment and on the surrounding community,” Horton told WPLN News. “I looked at what regulations and protections that we have here in Nashville to govern large and hyperscale data centers and the answer was zero.”

If the rules are approved, any data centers over 500,000 square feet (like the xAI facility) would not be permitted in Nashville. Centers ranging from 100,000 to 500,000 square feet would require a special exemption from the Board of Zoning Appeals and would be subject to a public hearing.

The legislation would also regulate centers of all sizes, limiting where they could be built, as well as establishing design and operation standards. These include compliance with certain emissions standards, noise pollution requirements and building height limits. These would not apply to existing data centers, only new ones.

In addition to Horton, 13 other members of the Metro Council have signed onto the legislation. It will be considered on the first of three required readings at the next council meeting on June 2.