Data centres could push 11-fold rise in water consumption by 2028, says report

A recent report from Morgan Stanley highlights a concerning trend regarding the environmental impact of artificial intelligence (AI) data centers. By 2028, it is anticipated that these facilities will consume approximately 1,068 billion liters of water annually, primarily for cooling and electricity generation. The report emphasizes that while the need for water in cooling data centers is well known, the indirect water usage linked to electricity production is often overlooked. The overall water footprint of AI encompasses three key aspects: the direct water usage for cooling systems, the water required for electricity generation, and the significant quantities needed to manufacture the specialized chips that power AI technologies. Interestingly, semiconductor manufacturing can use up to five million gallons of ultrapure water each day, which significantly contributes to the total water consumption attributed to AI. The projections made in the report are based on various factors, including assumptions about water intensity, consumption rates, cooling technologies, and the energy mix in different regions. Morgan Stanley's analysis outlines a wide range of potential outcomes for annual water usage by 2028, estimating figures could fluctuate between 637 billion liters and 1,485 billion liters, depending on the implementation of more efficient technologies. Although AI's global water consumption might seem manageable, the report notes that its effects are felt most acutely in specific locations. A significant concern arises from the fact that over half of the world's leading data center hubs are located in areas already experiencing moderate to high risks associated with water scarcity, drought, and declining water quality. This trend is mirrored in many emerging markets, where new data centers are being established in regions facing high water stress. As the demand for AI technologies escalates, the necessity for effective water resource management becomes increasingly critical. The industry must navigate this evolving challenge to ensure sustainable growth moving forward.