xAI's $1B Tesla Megapack purchase powers AI data centers
xAI spent $269M in one month on battery storage for AI training
Elon Musk's xAI has purchased $1 billion worth of Tesla Megapack products since 2024, according to a SpaceX IPO filing. The single month of April 2026 accounted for $269 million—more than the entire 2024 total of $191 million. xAI's Colossus supercomputer in Memphis already deploys 168 Megapack units with plans for roughly 1 GWh of buffering capacity to support 2 GW of compute. The spending highlights how deeply intertwined Musk's companies are, with Tesla recognizing $573 million in 2025 revenue from SpaceX and xAI combined—about 4.5% of its energy division's total.
Despite the massive battery investment, the power stored and dispatched by these Megapacks comes overwhelmingly from natural gas. xAI runs nearly 50 gas turbines at its Mississippi data center and won permits for a 41-turbine plant that could emit over 6 million tons of CO2 annually. While xAI announced a token 100 MW solar farm, it plans $2.8 billion more in gas generation. This clashes with Tesla's mission of a "solar electric economy," raising concerns among investors and environmentalists about the real-world impact of Musk's AI ambitions.
- xAI has spent ~$1B on Tesla Megapacks since 2024, with $269M in April 2026 alone.
- The Megapacks power xAI's Colossus supercomputer (168 units, ~1 GWh capacity) for 24/7 AI training.
- Power stored comes mostly from natural gas, contradicting Tesla's clean-energy mission—xAI plans $2.8B more gas generation.
Why It Matters
AI's enormous energy appetite is driving cross-company spending, but reliance on fossil fuels undermines Tesla's core mission.