SpaceXAI is moving to stop its Memphis supercomputer from drinking the city’s water. The company has laid out plans for the Colossus Water Recycling Plant, an 80 million dollar facility that would take treated wastewater from a nearby plant and turn it into the high purity cooling water its data center needs, rather than pulling from the aquifer that supplies SpaceXAI‘s host city with drinking water. It is both an engineering project and an answer to a criticism that has followed the company since it arrived in Memphis.
As SpaceXAI describes it, the plant would process up to 13 million gallons of treated wastewater a day, using what the company calls the world’s largest ceramic membrane bioreactor to clean it to the standard an AI data center requires. That volume is enough to end the company’s draws from the Memphis Sand Aquifer entirely, protecting roughly 5 billion gallons of drinking water a year, while any surplus the plant produces would be offered to other local industries rather than discarded.
See the SpaceXAI Memphis post on X
The project matters because SpaceXAI’s water use has been a genuine flashpoint in Memphis, since its Colossus data center, which trains and runs the Grok models, needs enormous amounts of water for cooling, and records have shown it drawing millions of gallons of drinking water a month, which alarmed residents and local officials who worry about the aquifer. A recycling plant that leans on wastewater instead of the drinking supply is the company’s way of easing that concern while still feeding a machine that only grows more demanding as it scales.
Construction has not been smooth, however, because work that began in 2025 stalled in early 2026, with Elon Musk saying the company needed to focus first on finishing Colossus 2, its second Memphis data center, and making it stable before returning to the water plant. SpaceXAI now says construction will restart in January 2027, and city officials have sounded optimistic about both the timeline and the benefits, especially since underground infrastructure is already in place and millions of dollars have already gone into the site.
The plant is a small window into one of the least discussed costs of the AI boom, which is water, because as companies race to build ever larger data centers, from SpaceXAI in Memphis to the wave of AI campuses rising around the world, the strain on local power grids and water supplies is becoming a real source of friction with the communities that host them. Turning a data center’s cooling need onto recycled wastewater, if it works at this scale, is one of the more concrete answers the industry has offered so far, which makes Memphis an early test of whether the promise holds. For now the commitment is renewed and the timeline is set, with the harder proof still a construction season away.
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