Key Takeaways
- Data centers consumed an estimated 222 billion liters (59 billion gallons) of water worldwide in 2025 for cooling, a figure that could nearly triple by 2030 without mitigation.
- Nvidia’s new DSX system employs a closed‑loop, liquid‑direct‑to‑chip cooling approach that can “eliminate water consumption almost entirely” at some facilities by allowing warmer coolant (≈45 °C) to flow through servers.
- The water‑energy trade‑off means cutting water use often raises electricity demand, since the coolant must still be cooled—typically by air‑flow fans.
- Major cloud providers (Microsoft, AWS, Meta) report improved water‑use efficiency (25 %–37 % gains from 2022‑2025) while still increasing absolute water consumption as they expand.
- Hidden water use—water needed to generate electricity and manufacture chips—can double the direct consumption of a U.S. data center, complicating sustainability accounting.
- Public‑relations pressure, rather than pure cost savings, drives many firms to pursue water‑reduction technologies, as water remains cheap compared with electricity.
- Retrofitting older data centers is costly, but many legacy sites are smaller and already use less cooling than the massive new hyperscale facilities being built today.
Growing Public Concern Over Data‑Center Water Use
Data centers are increasingly seen as thirsty neighbors in the United States, sparking a “wall of public anger” over their massive draw on both water and power. As the backbone of the internet and the rising demand for artificial intelligence, these warehouses of computer servers generate intense heat that must be dissipated. Keeping the chips cool traditionally relies on vast quantities of water, a resource that communities are now scrutinizing more closely.
“Data centers are the warehouses full of computer servers that run the internet and increasingly artificial intelligence. The computers get hot, and keeping them cool takes water.”
The scale of the issue is stark: consultancy Rystad Energy estimates that in 2025 data centers worldwide used 222 billion liters (59 billion gallons) of water for cooling alone. Without adaptive measures, that figure could rise to 644 billion liters by 2030, almost triple the current level. Even modest efficiency gains could keep growth under double, but the trajectory remains alarming for water‑stressed regions.
Nvidia’s Closed‑Loop DSX Claim
Nvidia has positioned its newest AI‑focused system, DSX, as a potential game‑changer. In a June report, the chip giant asserted that DSX can “eliminate water consumption almost entirely at some facilities.” The technology routes a liquid coolant directly through the servers, placing it as close as possible to the chips, which can exceed 80 °C (176 °F) under load.
By bringing the coolant into contact with the heat source at the chip level, Nvidia aims to bypass the large‑scale evaporative or spray‑cooling methods that traditionally guzzle water. The company claims that, with DSX, the need for external water intake can be dramatically reduced, if not erased, at certain sites.
“Nvidia said in a June report that it can eliminate water consumption almost entirely at some facilities when deploying DSX, its newest system for designing and managing AI data centers.”
The Water‑Energy Trade‑Off
Despite the promising headline, experts warn that reducing water use often comes with an energy penalty. Andy Masley, an independent researcher tracking AI and data‑center trends, notes the “pretty direct trade‑off between how much water is used and how much energy is used” for temperature control.
In a closed‑loop system, the coolant absorbs heat from the chips and must then be cooled again before recirculating. This secondary cooling is typically achieved by blowing air over the liquid—a process that consumes electricity. Consequently, any savings in water may be offset by higher power draw, especially in climates where ambient air is insufficient to provide the needed cooling.
“Cutting back on water use usually means more power as the liquid in those sealed pipes still has to be cooled down somehow, usually by blowing air over it — and that takes electricity.”
Nvidia mitigates part of this trade‑off by allowing the coolant to enter the servers at a relatively warm 45 °C, rather than the typical 32 °C used in most closed‑loop designs reported by the Uptime Institute in 2024. By starting with warmer water, the system relies more on “simple fans circulating the air” and less on energy‑intensive chillers, though extreme heat waves or hot climates still necessitate supplemental chill airflow or evaporative cooling.
“Most other closed-loop systems ran at about 32C in 2024, according to the Uptime Institute, which certifies data centers. By starting with warmer water, Nvidia does not need to pump in cooled air year‑round.”
Industry Responses: Microsoft, AWS, Meta
The three largest cloud providers have echoed Nvidia’s shift toward closed‑loop cooling, insisting that their systems involve “no net water loss.” Microsoft, Amazon Web Services (AWS), and Meta told AFP that they recycle water within sealed loops, minimizing discharge to the environment.
Nevertheless, their overall water footprints have risen alongside aggressive expansion. Between 2022 and 2025, Microsoft and AWS reported increases in total water use, yet their water‑use efficiency improved by 25 % and 37 %, respectively, according to their latest sustainability reports. Meta did not disclose specific efficiency gains but affirmed its adoption of similar closed‑loop technology.
“Microsoft, Amazon Web Services (AWS) and Meta told AFP that they also use closed-loop systems, which they said involve no net water loss.”
The lack of a standardized reporting framework for environmental, social, and governance (ESG) metrics makes cross‑company comparisons difficult. Notably, Elon Musk’s SpaceX—now a major data‑center player after acquiring the AI firm xAI—has never published an ESG report, and MSCI assigned it the lowest possible ESG rating in June.
“There is no industry‑wide consistency, however, in how companies report data on so-called environmental, social and governance (ESG) efforts.”
Economic Incentives and Public‑Relations Pressure
Water is generally inexpensive compared with electricity, giving firms little financial motive to curb consumption purely on cost grounds. Shaolei Ren, an engineering professor at the University of California, Riverside, observes that “there are incentives… but they have more to do with public relations amid the growing backlash to data centers across the United States.”
Ren’s point underscores that the drive toward water‑saving technologies often stems from reputational risk rather than direct savings. As communities protest new data‑center proposals over fears of depleted aquifers and higher utility bills, companies respond by highlighting efficiency upgrades and sustainability commitments—even when the underlying economics favor electricity over water.
“Because water is generally much cheaper than electricity,” companies have less incentive to cut water use on cost grounds alone, said Shaolei Ren, an engineering professor at the University of California, Riverside.
The Challenge of Retrofitting Legacy Facilities
Upgrading older data centers to newer, low‑water cooling systems presents a significant capital hurdle. Nonetheless, Minh K. Le, who leads data‑center and hydrogen research at Rystad, argues that the impact may be “less than it sounds.” Many legacy sites are smaller and less powerful than the hyperscale facilities being erected today, meaning their baseline cooling demand—and thus water use—is already modest.
Consequently, the biggest water savings will likely come from designing new centers with water‑efficient architectures from the outset, rather than attempting costly retrofits of existing, lower‑capacity buildings.
“Older data centers are smaller and less powerful than the enormous new ones being built now, so they need less cooling in the first place, said Minh K. Le, who leads data center and hydrogen research at Rystad.”
Hidden Water Footprint: Power Generation and Chip Manufacturing
A crucial nuance often overlooked is that direct water use for cooling represents only part of a data center’s total water footprint. In the United States, the water required to generate the electricity that powers these facilities—and to manufacture the chips and servers they house—can equal or even exceed the amount consumed onsite for cooling.
Studies suggest that this “hidden” water consumption can be approximately twice the direct cooling volume, amplifying the sustainability challenge. Any strategy that focuses solely on reducing on‑site water intake must also address the energy mix and supply‑chain water intensity to achieve a true net reduction.
“In the United States, that hidden water use can be twice the amount a data center consumes on its own.”
Outlook: Balancing Growth, Resources, and Public Trust
The data‑center industry stands at a crossroads. Explosive demand for AI workloads drives relentless construction of ever‑larger facilities, intensifying scrutiny over water and power consumption. Innovations such as Nvidia’s DSX closed‑loop cooling demonstrate that technological pathways exist to curb direct water use, yet they are accompanied by energy trade‑offs and implementation costs.
Major cloud operators report efficiency gains, but absolute water withdrawals continue to rise as capacity expands. The absence of uniform ESG reporting hampers accountability, while public‑relations pressure—rather than pure economics—appears to be the primary catalyst for change.
Moving forward, a holistic approach will be essential: coupling advanced cooling designs with renewable‑energy sourcing, transparent water‑use accounting, and community engagement to ensure that the digital infrastructure underpinning the modern world does not come at an unsustainable price to local water resources. Only then can the industry reconcile its growth trajectory with the environmental limits and social expectations of the regions it serves.
https://uk.finance.yahoo.com/news/ai-data-centers-less-thirsty-011624539.html