AI data centers are less thirsty now: Tech giants
Data centers in the US are facing public criticism for their high water and power consumption. Tech giants are addressing this by implementing new cooling technologies, such as closed-loop systems, to reduce water use, though this often increases electricity demand. While efficiency has improved for some companies, the industry still faces challenges in consistent reporting and upgrading older facilities.
Data centers across the United States are facing public backlash due to their significant water and power consumption. However, leading technology companies claim to be making progress in reducing their water footprint, particularly for AI data centers.
Nvidia, an American chip giant, stated that its new DSX system for AI data centers can almost entirely eliminate water consumption at some facilities through a closed-loop cooling system. This method circulates liquid directly through servers, allowing for warmer water temperatures and reducing the need for extensive air conditioning. However, independent researcher Andy Masley notes a direct trade-off, where reduced water usage typically increases electricity consumption for cooling the liquid.
Microsoft, Amazon Web Services, and Meta also report using closed-loop systems, claiming no net water loss. These companies have shown improvements in water use efficiency, with Microsoft improving by 25 percent and AWS by 37 percent between 2022 and 2025. Despite these advancements, industry-wide consistency in environmental, social, and governance (ESG) reporting is lacking, with companies like Elon Musk's SpaceX, a growing player in data centers after acquiring xAI, having not published an ESG report.
Shaolei Ren, an engineering professor at the University of California, Riverside, suggests that while water is generally cheaper than electricity, public relations pressures are driving companies to cut water use amidst growing opposition. Additionally, upgrading older data centers to more efficient technologies is costly, though these older facilities are smaller and inherently require less cooling. The article also highlights that indirect water use, such as for electricity generation and chip manufacturing, can be twice the amount directly consumed by a data center.