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Data centers can affect electricity costs, water supplies, and air quality, but the effects are not uniform. A facility’s impact depends on its power demand, local utility rates and infrastructure plans, cooling system and water source, regional electricity mix, and onsite generators. National figures show the scale of the issue; local utility, water, and air-quality records are needed to determine what a particular facility means for nearby residents.
How data centers affect the surrounding community
A data center can have environmental effects through several connected routes. It uses electricity to run servers and cooling equipment. Cooling may consume water onsite, while the power plants supplying its electricity may consume water elsewhere. Electricity generation and onsite combustion can also produce greenhouse gases or conventional air pollutants.
Those routes should be considered separately. A data center’s own electricity bill is not the same thing as the rates paid by households. Water consumed at a power plant is not onsite cooling water. And climate emissions from electricity generation do not, by themselves, establish the level of local exposure to air pollution.
How much electricity do data centers use?
U.S. data-center electricity use is substantial and growing, but estimates for future demand are projections rather than measured outcomes. Lawrence Berkeley National Laboratory’s (LBNL) June 2026 United States Data Center Energy Usage Report: 2025 Update estimates a 2030 reference-case load of 649 terawatt-hours (TWh). Its compounded uncertainty range is 521–843 TWh. The modeled range reflects uncertainty in equipment shipments, electricity use per device, cooling performance, facility type, location, and other assumptions, including AI-chip shipments and utilization.
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For historical context, LBNL’s 2024 report estimated that data centers used 176 TWh in 2023, about 4.4% of U.S. electricity. The U.S. Department of Energy (DOE) summarized that estimate in 2024. It is a historical estimate, not a current-year measurement or a substitute for the newer 2030 outlook.
Do data centers make electricity bills go up?
They can contribute to costs that affect other customers, but a new data center does not automatically produce a fixed surcharge on nearby household bills. The facility pays under its applicable tariff or contract. Household rates may also be affected if the utility invests in generation, transmission, distribution, or other infrastructure to serve the new load. Who ultimately pays depends on the utility’s forecasts, the cost and use of that infrastructure, contract terms, and decisions by state regulators.
DOE’s January 17, 2025 brief, Electricity Rate Designs for Large Loads: Evolving Practices and Opportunities, identifies fair allocation of system costs, protection against stranded utility investment, and resource adequacy as issues for utilities and regulators. It describes the goal as “Fair allocation of electricity system costs to large-load customers without unfair shifting of costs to other customers.” That is a rate-design objective, not evidence that any particular utility has achieved it or that a particular household’s bill has risen because of a data center.
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For a local bill claim, look for the serving utility’s rate filings, the regulator’s orders, any public special contract for the facility, and utility forecasts and infrastructure plans. Check whether the proposed costs are assigned to the large-load customer, shared among customer classes, or recovered through broader rates. Without those local records, national demand statistics cannot establish the effect on a household’s bill.
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Water accounting has two distinct parts: water used at the data center and water used to generate its electricity. LBNL’s 2024 report estimated 66 billion liters of direct water consumption by U.S. data centers in 2023, primarily associated with onsite cooling. Separately, it estimated nearly 800 billion liters of indirect water consumption for the electricity used by data centers, based on regional grid mixes. The indirect water is consumed in electricity generation and may be far from the server building; it is not onsite cooling water.
These quantities describe different locations and processes, so they should not be added or presented as though they measure a single facility’s water use. LBNL’s national estimates also do not show the water source, seasonal peak, or potable-water share for an individual facility.
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Withdrawal is not the same as consumption
Withdrawal is water taken from a source. Consumption is water not promptly returned to the same local water system, often because it evaporates. A facility can withdraw water and return some of it; a withdrawal figure alone therefore does not tell you how much water is consumed or unavailable locally.
Cooling design affects onsite water use
Cooling towers use water that evaporates. Airside economizers and dry cooling can reduce direct water consumption when conditions allow. Cooling choices can involve electricity-efficiency trade-offs, so a facility with lower onsite water use does not necessarily have a lower total water impact once electricity-related water use is considered.
Whether a data center uses drinking water cannot be answered for all facilities from national estimates. A particular site may use potable water, non-potable water, or a mix; the answer depends on its supply and cooling arrangements. Check the facility’s disclosures and municipal water-provider records, including source, withdrawal, consumption, seasonal use, and drought restrictions. Compare those figures with local availability and basin stress.
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What water and emissions come from the electricity supply?
Electricity-related impacts depend on where and how the power is generated. In its 2024 report, LBNL estimated national-average indirect water consumption of 4.52 liters per kilowatt-hour and emissions of 0.34 kilograms of carbon-dioxide equivalent per kilowatt-hour for data-center electricity under its grid-mix method. These are national averages attributed using regional electricity mixes, not measurements at a specific data center or power plant.
LBNL states that “The water consumption and GHG emissions embedded in electricity use depend on the fuel type, technology, and the location of generation.” Its method assigns counties to balancing authorities and uses regional generation information. It did not incorporate individual power-purchase agreements or behind-the-meter generation because facility-specific data were unavailable. A national average therefore cannot identify the actual marginal power source serving a particular facility at a particular hour.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Do data centers cause air pollution?
They can be associated with pollution from both grid electricity and onsite combustion, but those sources have different locations and implications. Fossil-fuel power plants supplying electricity emit greenhouse gases and may emit conventional pollutants. Onsite combustion, including diesel backup generators, can produce pollutants closer to nearby residents. EPA explains that distributed-generation combustion impacts may be smaller in scale than those from large power plants while occurring nearer to populated areas.
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- REAL-TIME ENERGY DATA: REQUIRES 2.4 GHz WIFI WITH AN INTERNET CONNECTION to monitor energy use with iPhone / Android / Web app. Vue sensors collect energy data and are accurate from ±2%. The Vue is UL and CE Listed for your safety. 1 second data is only available in the app (when actively open) and retained 3 hours. Minute and hour data are retained in the cloud. 1 minute data is retained 7 days, 1 hour data is retained indefinitely. Export cloud data whenever you want in the app.
Carbon-dioxide-equivalent emissions are a climate measure; they do not quantify neighborhood exposure to nitrogen oxides, fine particles, or other local pollutants. Actual exposure depends on generator and fuel type, operating and testing hours, emissions controls, permits, wind, and geography. The Colorado Legislative Council Staff’s 2026 memo identifies pollution from fossil-fuel generation and diesel backup generators as a public-health concern, while noting that more research is needed on long-term outcomes in host communities.
EPA’s eGRID provides regional power-sector emissions and resource-mix context. Its Power Profiler can identify a ZIP code’s eGRID subregion and estimate electricity-related emissions using regional factors. These tools are useful for context, not proof of a facility’s specific emissions or a nearby resident’s exposure.
A narrow regulatory point about islanded generation
In a July 27, 2026 announcement, EPA described its guidance that the Acid Rain Program does not apply to generation facilities that are not connected to a public grid, under EPA’s stated interpretation. EPA said a facility that later connects to the grid may become subject to program provisions. This interpretation concerns that program only; it does not mean an islanded generator is exempt from every other air-pollution rule or permit. Applicable requirements depend on the facility and should be checked against current rules and permits.
How to find out what a data center near you uses
There is no single national dataset that establishes a particular facility’s effect on local bills, drinking-water supply, or neighborhood air. Start with the facility, its serving utilities, and the relevant public records. For a new project, distinguish proposed or forecast demand from actual operations.
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- Identify the facility and service providers. Confirm the site address, electric utility, water provider, and relevant state utility commission or other regulator.
- Check electricity costs and infrastructure plans. Review the utility’s rate case, large-load tariff, commission orders, public facility contract if available, load forecasts, and generation, transmission, and distribution plans. Look for who funds new infrastructure and how the utility addresses the risk that it may be underused or stranded.
- Request facility electricity figures. Compare projected and actual annual consumption with peak demand. Those values answer different questions: annual use indicates energy over time, while peak demand affects the capacity the utility must be prepared to serve.
- Check water disclosures and municipal records. Seek withdrawals and consumption by source, potable and non-potable shares, seasonal peaks, cooling-system type, and any applicable drought limits. Compare the figures with local water availability rather than relying on a national total.
- Review air permits and operating records. Look for generator types and fuels, permitted and actual operating hours, testing schedules, emissions controls, emissions tests, and nearby monitoring data. Interpret monitoring in light of local wind and geography.
- Use regional power data carefully. EPA eGRID and Power Profiler can provide regional context for the electricity supply, but they do not determine a facility’s hourly marginal source or onsite exposure.
How to compare two facilities fairly
Do not rank facilities on a single headline figure or on incomplete disclosures. Compare the same categories and time periods for both sites. If a value is unavailable, record it as unknown rather than assuming the facilities are alike.
- Electricity: projected and actual peak demand and annual consumption.
- Cost allocation: tariff, contract protections, and responsibility for new generation and grid infrastructure.
- Water: direct withdrawals and consumption by source and season, plus cooling design.
- Power supply: regional generation mix and its water and emissions intensity, with any limits on facility-specific attribution.
- Onsite emissions: generator type, permitted and actual operating hours, fuel, and controls.
- Disclosure: availability of utility and facility records, independent monitoring, and measured operating data.
Comparable records make a local assessment possible; national averages alone do not establish what residents near either facility pay, drink, or breathe.
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