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Data centers can become major local electricity and water users, but there is no single national “data-center footprint.” A facility’s impact depends on its server load, cooling design, climate, water source, grid connection, operating schedule and permits. Electricity is used by information-technology equipment and by cooling, ventilation, power conversion and lighting. Water is mainly consumed when cooling towers evaporate water; some additional water leaves as mineral-rich blowdown.
For a community considering a proposal, the useful question is not simply “How much water does a data center use?” It is: what are the project’s annual and peak demands, where will the water and power come from, what infrastructure is required, who pays, and what limits and reporting obligations will be enforceable?
Where a data center’s electricity goes
Servers and related information-technology equipment are the central electrical load. Supporting systems add to that load: chillers and pumps, cooling towers or other heat-rejection equipment, air handlers, ventilation, power-conditioning equipment, lighting and controls. These systems must operate continuously enough to keep computing equipment within safe temperature and humidity ranges, even when computing demand changes.
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What the latest federal outlook actually models
The U.S. Energy Information Administration’s Annual Energy Outlook 2026 models data-center server electricity separately from broader commercial computing. The model treats server load as essentially flat across hours. That is a modeling assumption for the outlook, not a claim that every facility has identical hourly behavior.
EIA reports that, on average in its model, cooling energy intensity for data-center floorspace may be as much as 2.9 times that of non-data-center floorspace. In the High Electricity Demand case, space-cooling electricity in 2050 is 84 billion kilowatt-hours higher than in the Counterfactual Baseline under the same population and weather assumptions. These are scenario comparisons, not a measured national total today or a prediction for a particular town. EIA released AEO2026 on April 8, 2026, and generally included laws and regulations in effect through December 2025. The underlying discussion is at EIA’s 2026 outlook page.
How cooling turns electricity and water into heat rejection
Computing equipment converts nearly all of its electrical input into heat. In a common chilled-water arrangement, air-conditioning equipment transfers that heat to a chilled-water loop; heat then moves to a condenser-water loop and is rejected through a cooling tower. The tower removes heat by evaporating some water into the atmosphere. As minerals become concentrated in the remaining water, a controlled discharge called blowdown is needed to protect equipment.
The Department of Energy’s Federal Energy Management Program states: “A cooling tower system by necessity uses an extensive amount of water because the warm water from the chiller’s condenser water loop is cooled by evaporating water into the surrounding atmosphere.” This is federal program guidance, not a universal consumption rate. Actual use changes with heat load, tower design, controls, water chemistry, weather, operating hours and the amount of heat rejected by non-evaporative equipment.
Withdrawal is not consumption
A proposal should distinguish at least four quantities:
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- Withdrawal: water taken from a municipal system, groundwater well, river, canal or other source.
- Consumption: water not returned to the source in the same usable condition, including evaporation and water incorporated into products or residuals.
- Discharge: wastewater or blowdown sent to a sewer, treatment plant or permitted receiving water.
- Peak demand: the maximum short-term flow or seasonal use, which can determine pipe, treatment and supply capacity even when annual volume looks modest.
Ask the applicant to report each quantity by source and season. A statement such as “the project will use reclaimed water” is incomplete without the expected withdrawal, consumptive loss, discharge quality, drought rules and backup source.
Metrics that help—but do not decide whether a project fits
Two standard metrics make operating performance easier to compare when their boundaries are disclosed. They do not, by themselves, answer whether a project is appropriate for a particular watershed or electric grid.
| Metric | Definition | What to request | Important limitation |
|---|---|---|---|
| Power usage effectiveness (PUE) | Total annual facility energy divided by annual energy used by IT equipment. | Value, measurement period, meter boundary, weather context and whether it is measured or projected. | A low PUE can still coincide with high total electricity demand or a stressed local grid. |
| Water usage effectiveness (WUE) | Annual site water use in liters divided by annual IT energy use in kilowatt-hours. | Water sources, site boundary, reporting period, cooling modes and treatment or discharge included in the calculation. | Site-only WUE may omit water associated with electricity generation or upstream fuel and treatment. |
DOE FEMP guidance describes an average-efficiency data center as having a PUE of 2.0 and says highly efficient facilities have approached the theoretical minimum of 1.0. Those statements come from a 2019 guidance page; they are broad reference points, not current universal benchmarks. A proposal should state whether its number is a design target, a modeled estimate or an independently verified operating result.
Cooling choices and their water–energy trade-offs
Evaporative cooling towers
Cooling towers can be efficient at rejecting heat, but evaporation and blowdown create a direct site-water demand. Water quality determines how many times water can circulate before blowdown is required. Poorly controlled chemistry can increase scaling, corrosion and maintenance, while overly conservative controls can waste water.
Air-side and water-side economizing
When outdoor conditions and air quality permit, air-side economizers use favorable outdoor air to reduce mechanical cooling. Water-side economizers use suitable outdoor conditions to provide cooling without running some chiller components. Their feasibility depends on climate, filtration, humidity limits, contamination risk, equipment design and controls. A dry climate may reduce evaporative demand but increase electricity for mechanical cooling; a humid climate can have the opposite trade-off.
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Hybrid and heat-recovery systems
Hybrid designs combine evaporative and non-evaporative heat rejection, switching modes as conditions change. Heat-recovery equipment can send usable heat to nearby buildings or processes when a compatible customer and pipeline exist. These options may reduce potable-water use or recover energy, but they add capital cost, controls and maintenance requirements. Require the applicant to describe expected performance in normal, extreme-weather and equipment-outage conditions rather than presenting a single best-case mode.
Operational measures
FEMP lists several operational opportunities: avoid unnecessarily low temperature set points and excessively tight humidity control, use economizers when climate and air quality allow, and maximize cooling-tower cycles of concentration within safe water-chemistry limits. FEMP’s cited guidance says increasing cycles from three to six can reduce cooling-tower makeup-water requirements by 20% and blowdown by 50%. Those figures are system-specific opportunities, not guaranteed savings for every facility. Controls, maintenance, treatment chemistry and actual heat load determine the result.
What water reuse can accomplish—and what it cannot
Reclaimed municipal wastewater, treated industrial water, surface water and other non-potable sources can reduce reliance on drinking-water supplies. Reuse is not impact-free: it requires collection, treatment, storage, dedicated pipes, monitoring, permits, a backup source and a plan for concentrated residuals or brine. The source may also be scarce during drought, and moving it can require substantial energy.
The Quincy, Washington example
EPA’s Quincy Water Reuse Utility case study describes a city-operated circular treatment system developed with Microsoft. EPA estimates that the system reduces potable-groundwater use for data-center cooling by 138 million gallons (522 million liters) per year. The utility also uses 260 million gallons (984 million liters) annually of Columbia Basin Project water, primarily in summer. In the arrangement described by EPA, 5% of annual makeup water remained potable groundwater.
The same case shows why a reuse label is not enough. Eastern Quincy sites were costly to connect and still used potable groundwater at the time described. Canal supply was interrupted during a hot, dry period in 2021, so backup groundwater was needed. Treatment produced concentrated residuals requiring permitted disposal. EPA describes a 30-year agreement in which Microsoft funded $31 million in capital costs and operating costs as specified in the case. Planning, design, construction and testing took about 10 years. These figures describe Quincy’s arrangement; they are not standard prices, timelines or outcomes for other communities.
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EPA’s Water Reuse Action Plan 2.0 summer update identifies planned collaboration on regulatory hurdles, best practices and state permitting of recycled water for data-center cooling. Planned collaboration should not be read as a uniform national rule or proof that every state has completed the same approvals.
How a data center can affect a community’s electric system
A large facility can require a new substation, transmission or distribution upgrades, generation capacity, storage, fuel arrangements and redundancy. The timing matters: a phased project may energize one building first and add server halls later, while a utility may have to reserve capacity before the full load arrives. Ask for both annual energy and maximum coincident demand, the date each phase is expected to start, and the assumptions behind those figures.
Cost allocation is equally important. A utility tariff or special contract may assign some connection costs to the customer, spread them across ratepayers or leave uncertainty until upgrades are designed. Reliability studies should show how the project affects reserve margins, outage restoration, voltage, transmission congestion and other customers’ service. If clean generation or storage is proposed, ask whether it is new and local, how firm it is during peak conditions, and who pays for replacement power when it is unavailable.
A practical community review before approval
Residents, local officials and utility regulators can request a written record before a land-use vote, water agreement, utility contract or permit decision. The following checklist turns broad promises into testable conditions.
- Define the build-out. Request site acreage, building count, server-hall phases, construction schedule, expected occupancy dates and the maximum planned expansion.
- Quantify electricity. Require annual megawatt-hours, maximum megawatts, hourly or seasonal load shapes, power factor assumptions, backup-generator testing demand and the timing of grid upgrades.
- Map the water balance. Request withdrawals, consumption, discharge and storage by month; identify potable, groundwater, surface and reclaimed sources; and show normal, drought and outage scenarios.
- Describe cooling modes. Obtain equipment specifications, design temperatures, economizer conditions, tower cycles of concentration, chemical treatment, expected WUE and the trade-offs in electricity, water and reliability.
- Examine wastewater and residuals. Ask about flow, temperature, mineral concentration, treatment capacity, sewer limits, brine or concentrate disposal and every required discharge permit.
- Assign infrastructure costs. Put in writing who pays for generation, transmission, substations, water-treatment capacity, pipelines, storage, operating costs and eventual decommissioning.
- Test drought and failure plans. Identify minimum water supplies, alternative sources, interruption triggers, backup power, emergency discharge procedures and curtailment commitments.
- Make disclosure enforceable. Seek public meter data, definitions for PUE and WUE, independent verification, reporting frequency, complaint contacts, audit rights and penalties or conservation conditions for noncompliance.
- Check cumulative effects. Evaluate the project alongside existing industrial users, planned housing, agricultural demand, environmental-flow requirements and other data centers seeking the same grid or watershed capacity.
Where officials can find permitting and planning information
Rules vary by state and locality. EPA’s state and local government resource page points officials to water and data-center information, Clean Air Act resources, Envirofacts permit and environmental-data layers, and related technical material. DOE identifies R-STEP technical assistance to help state and local communities plan and engage in large-scale renewable-energy and storage projects; its broader guidance is available at DOE’s electricity-demand page.
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Those resources are starting points, not substitutes for current local records. A community still needs to review water rights, utility filings, comprehensive plans, environmental permits, sewer capacity, drought restrictions, tax or development agreements and public-record disclosure requirements in its own jurisdiction.
How to compare two proposals without being misled
Use a common scorecard and require identical definitions. Compare:
- Annual and peak electricity demand, phase timing and grid location.
- Water withdrawal versus consumption, seasonal peaks and source scarcity.
- Cooling design, operating modes and energy–water trade-offs.
- Reuse percentage, backup supplies and drought performance.
- Wastewater, residuals, treatment capacity and permits.
- Capital and operating costs, including who bears each cost.
- Public access to measurements, audits, complaints and enforceable remedies.
Do not rank projects solely by PUE or WUE. A facility can report an attractive ratio while still being too large for a constrained watershed or grid, and a project using reclaimed water can still require substantial treatment energy, backup groundwater or residuals disposal.
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Data-center impacts are site-specific and measurable when applicants disclose the right boundaries. Electricity demand includes servers and the systems that keep them operating; water demand depends heavily on cooling technology, weather, chemistry and source. Federal outlooks provide useful scenarios, while the Quincy case demonstrates both the potential and the complications of reuse.
The strongest community decision is therefore neither an automatic approval nor a blanket rejection. It is a conditional, evidence-based review that requires peak and annual load data, a complete water balance, cooling and drought plans, wastewater permits, transparent cost allocation and public monitoring before construction commitments become irreversible.
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