• 517 out of 809 planned US data centers currently located in locations under the influence of a drought for the past year
• US regulators are taking note of direct data center cooling needs, but might be overlooking power generation and fabrication costs
• The issue is fast becoming political for many Americans, 70% of whom do not want to live next to a data center

The United States might be in the grip of a record-shattering drought, but AI data center builders and their proponents seem unfazed for now.

This is despite local frustrations over the detrimental impact of AI data centers on living conditions, which are becoming increasingly vocal.

The unprecedented situation is impacting both power generation and water supply alike, but is finding a somewhat muted response from political stakeholders in various regions

AI's water needs far exceed the closed loop

The AI industry maintains that closed loops are highly efficient in both cooling and water use, and datacenter operators such as AWS are implementing their own custom loops to capitalize on the situation, but that might just be the tip of the iceberg here.

The elephant in the room for most data centers is power: all current buildouts will require reliable power to support the compute they are expected to house in the near future.

This is particularly challenging at a time when the US grid is already expected to be strained, even as it passes increased power costs on to consumers over the next few years.

In a report published by Xlyem, estimates indicated that out of the increase in AI-centric demand for water, only 4% is directly attributed to the data center, while a mammoth 96% is indirect (power generation at ~54% and semiconductor fabrication at ~42%), with much of the focus on the former versus the latter.

At a time when US data center construction continues wherever possible, even as some insurers raise concerns, a drought seems a rather secondary concern for companies on a warpath toward Artificial General Intelligence (AGI).

This has led some regions in the US to take a proactive approach, with Seattle effectively banning new data center projects for an entire year as the city grapples with higher electricity costs and a relative lack of tangible benefits for residents.

Water and power are shaping up to be AI's biggest challenges over the next decade, even as companies continue to ravenously demand more compute, but others are less thrilled about the whole issue, pointing out that there are other concerns in play with rural, conservative populations, a key voter demographic for the current US administration, being the most affected by increasing water and power costs even as access becomes a bigger concern.

Andrew Coppin, the CEO of Ranchbot, a tool that allows ranchers to monitor their water use, summed up the situation, speaking to The Guardian:

“The concerns from farmers are real and justified. Datacenters are flavor of the month now, but we wouldn’t make the choice to only be able to have a shower on Mondays, Wednesdays, and Saturdays. I mean, ChatGPT is a pretty nice tool, but most people would prefer to have a beef steak if they had to choose.”

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Rahim Amir is a UAE-based tech writer who enjoys building PCs as much as he enjoys writing about them. He has been professionally writing about PC hardware since 2023, focusing on buyer’s guides, hardware reviews, and sponsored content and features related to tech.

Having built hundreds of gaming PCs and being an avid gamer in his spare time, Rahim tends to have stronger opinions about hardware than most. This is particularly on display when he gets his way with powerful, but minimalistic RGB builds even as Small Form Factor (SFF) PCs come a close second.