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Data centers can create significant local and system costs, but there is no single global cost figure. The clearest way to assess a proposal is to look at its electricity demand and grid connection, cooling water and its source, operational noise, and who bears the costs of utility upgrades and land use. The scale and trade-offs depend on the site: U.S. electricity figures are forecasts, Australian figures here are national estimates from a ministerial speech, and EU rules provide a reporting framework rather than a global impact measure.
Why do data centers have real-world costs?
A data center’s computing equipment needs electricity and cooling, and the facility must connect to local utilities and a suitable site. Those requirements can affect the surrounding area directly through water use, heat rejection, equipment noise, backup generation and land use. They can also have wider effects if serving the facility requires more generation, transmission or water-system capacity.
These costs are connected. A cooling design can change both energy use and water demand, while equipment and backup systems can contribute to site noise. The relevant question is not simply whether a data center uses a lot of one resource; it is how its design and operating conditions interact with the capacity and needs of the particular place.
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How much electricity do data centers use?
The latest U.S. estimate in the evidence cited here is a projection, not a measurement of future consumption. Lawrence Berkeley National Laboratory’s United States Data Center Energy Usage Report: 2025 Update, published in June 2026, puts U.S. data-center electricity consumption in 2030 at 649 terawatt-hours (TWh) in its reference case. Its compounded uncertainty bounds are 521–843 TWh.
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The report uses a bottom-up model based on projected equipment shipments, energy use per device, cooling performance, facility types and locations. The range matters: changes in those inputs can move the estimate, so 649 TWh should not be treated as a guaranteed outcome or a measured value.
A previous estimate should not be read as a direct forecast update for the same year. The U.S. Department of Energy’s December 2024 summary of an earlier LBNL report said U.S. data centers used an estimated 176 TWh in 2023, about 4.4% of U.S. electricity, and projected 325–580 TWh for 2028. That is an earlier report’s estimate and projection, with a different forecast horizon and assumptions from the 2026 update.
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What do the available figures say—and not say?
| Jurisdiction and source | Figure | What it describes |
|---|---|---|
| United States; LBNL, June 2026 | 649 TWh in 2030; uncertainty bounds of 521–843 TWh | Model-based reference-case estimate and compounded uncertainty bounds for U.S. data-center electricity consumption in 2030. |
| United States; DOE summary of earlier LBNL report, December 2024 | 176 TWh; approximately 4.4% in 2023 | Earlier report’s estimate of U.S. data-center electricity use and share of U.S. electricity. |
| United States; DOE summary of earlier LBNL report, December 2024 | 325–580 TWh in 2028 | Earlier report’s projection for U.S. data-center electricity use in 2028. |
| Australia; ministerial speech, 10 June 2026 | Around 2% of National Electricity Market electricity | National estimate stated by Andrew Charlton, Australia’s Minister for Industry, Science and Resources; it is not a U.S. or global share. |
| Australia; ministerial speech, 10 June 2026 | 7 gigalitres in 2024–25 | Estimated cooling-water consumption by Australian data centers, as stated by the minister. |
The figures cover different places, years and measures. They cannot be added together or treated as one global estimate. In particular, the Australian speech’s national figures do not establish what a particular facility uses or whether its local utility and watershed can accommodate it.
How much water do data centers use?
Water impact depends on the facility’s cooling design and the local conditions where it operates. A national total or share cannot tell a community whether a specific site’s demand will be manageable, especially where water availability varies by place or season. The Australian minister’s estimate of 7 gigalitres for data-center cooling in 2024–25 is a national figure stated in a 10 June 2026 speech, not a universal water-use rate.
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For a proposal, ask what water the facility expects to draw, where that water comes from, when demand will peak, and how the estimate distinguishes total water input from potable water. The European Union’s Delegated Regulation (EU) 2024/1364 offers one example of a measurement framework: it includes energy, water, renewable-energy and reused-heat indicators, and specifies total water input using its stated WUE methodology while measuring potable water input separately. A reporting framework helps define comparable measures; it does not establish that every facility makes facility-level data public.
Why can noise and cooling become community issues?
Noise is a siting and permitting concern, but the evidence cited here does not establish a universal decibel level, safe distance from homes or typical noise footprint for data centers. Conditions depend on equipment, site layout, operations, nearby uses and any backup generators. Clusters of facilities can also raise questions about cumulative sound, rather than the sound from one site considered in isolation.
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In a 10 June 2026 speech, Australian Industry, Science and Resources Minister Andrew Charlton described community concerns as including “accumulated noise of data centre clusters, visual impact, and the conflicts where industrial sites are proposed near homes.” That is the minister’s characterization of concerns, not a measured noise finding.
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Who pays for grid and utility needs?
The facility’s electricity demand is only one part of the cost question. A local grid connection may involve new or expanded infrastructure, and water demand may require capacity in a local water system. Whether costs fall on the operator, other utility customers or public budgets depends on project-specific arrangements and rules; the figures cited above do not establish the bill impact of any particular data center.
For electricity, ask for both expected annual consumption and peak demand, the planned connection timing, available generation and transmission capacity, and which party funds required upgrades. For water, ask whether the source and delivery system can meet the proposed demand under local conditions. These questions distinguish a facility’s direct resource use from costs that may arise across the wider system.
What benefits should be weighed against those costs?
Data centers may bring investment, construction employment, digital infrastructure and electricity procurement that supports energy projects. In his 10 June 2026 speech, Minister Charlton presented these as potential benefits alongside concerns about power, water, noise, siting and opportunity costs. That policy argument is not a universal balance sheet: a community should ask for evidence specific to the project and location rather than assume the same benefits or trade-offs apply everywhere.
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Compare expected local benefits with pressure on scarce power, land, water, utility capacity and skilled labor. For example, projected jobs should be described in terms that make clear what is expected locally, while claims about renewable-power procurement should specify what is being procured and how it relates to the facility’s demand. The cited figures do not quantify these outcomes for a specific proposal.
How to assess a data-center proposal locally
Use a consistent set of questions so a project’s claimed benefits and resource demands can be compared on the same boundaries and reporting periods.
Quick Recap
Electricity and grid capacity
- What are the projected annual electricity use and peak demand, and what assumptions underlie each figure?
- When is the facility expected to connect, and what generation or transmission capacity will serve it?
- Are grid upgrades required, and who is responsible for funding them?
Cooling water and local supply
- What cooling approach is proposed, and what are the expected total and potable water inputs?
- What is the water source, how does demand vary by season, and can local watershed and municipal systems accommodate it?
- Are the measurement boundaries and reporting periods clear enough to compare the proposal with other facilities?
Noise, generators and siting
- What operational equipment and backup generators are expected to contribute to noise?
- How will cumulative sound from nearby facilities be considered?
- How close are homes and other sensitive uses, and what noise limits or monitoring conditions would apply?
Distribution of costs and benefits
- What local employment, investment or other public benefits are expected, and what evidence supports the estimates?
- How will the proposal affect pressure on utilities, land, housing and skilled labor?
- Are the claimed benefits proportionate to the project’s expected demands on scarce local resources?
Transparency and comparable reporting
- Do energy and water figures use consistent facility boundaries, definitions and reporting periods?
- Are total and potable water reported separately, and are forecast values distinguished from measured consumption?
- Can residents and decision-makers see enough information to evaluate assumptions, monitoring and permit conditions?
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