FOX5 Investigates: Nevada data center boom strains energy, water, and land resources
Nevada faces significant challenges in providing energy, water, and land for its booming data center industry, which includes companies like Switch and Google. Multiple localities, including Reno and Nye County, have enacted moratoriums or bans on new data centers to address resource strain, while utilities like NV Energy work to expand infrastructure. Local governments are reviewing permitting policies and weighing data center development against other land uses.
Nevada is poised to become the world's second-largest data market, but a memo from the state’s Legislative Council Bureau highlights significant challenges in supplying the necessary energy, water, and land. Michael Brown, a fellow at the Lincy Institute at UNLV, notes the dramatic shift to hyperscale data centers, driven by artificial intelligence, now requiring hundreds of megawatts of power compared to earlier facilities that used around 40 megawatts.
Energy infrastructure is under strain, with Erik Henzl of the Desert Research Institute reporting that data centers consumed 22% of Nevada’s generated power in 2024. He projects that by 2030, a mere dozen data centers could demand nearly three times the electricity produced by Hoover Dam. NV Energy Senior Vice President Shawn Elicegui reassures that the utility is planning for future energy needs, constructing new transmission lines, and ensuring that data centers requiring additional infrastructure cover those costs. However, proposals for private power plants by developers in northern Nevada have yet to be approved by regulators.
The state's water supply presents another critical hurdle, exacerbated by drought conditions and over-appropriated hydrographic areas. Google’s Henderson data center, for instance, used over 404 million gallons of water in 2024 for cooling, which is not reclaimable. In response to such demands, the Southern Nevada Water Authority banned evaporative cooling in all new commercial and industrial buildings in 2023, though existing facilities like Google's are exempt. Operators like Novva and Switch claim to use water-free cooling systems in their Valley facilities.
Industrial land availability is also a limiting factor, largely due to public land ownership, forcing county leaders to carefully weigh data center development against alternative uses like affordable housing or manufacturing, which create more jobs. Local governments are taking action: Henderson is reviewing its permitting policies, Reno enacted a moratorium on new data centers until August 2027, and the Nye County Water District approved an emergency ban in Pahrump to conserve diminishing water resources. Activists in Boulder City attempted to put a data center question on the November ballot but failed to gather sufficient signatures. Storey County, east of Reno, has an established industrial framework supporting seven data centers, but experts suggest this model is not broadly replicable. The state faces a balancing act between asserting its role in the digital world and managing increasing grid and water stress.