The Business of Water in the Data Center

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08/27/2025

Fueled by the demand for advanced and generative artificial intelligence (AI), society’s collective appetite for data-driven insights is unyielding. According to research from the United Nations, the global AI market will increase by a factor of 25, rising from $189 billion in 2023 to $4.8 trillion by 2033.

“We are generating new workloads, and they are more compute-intensive than ever before,” says Moises Levy, Ph.D., managing director, research and market intelligence at Datacenter Dynamics. “Those workloads need to be processed, and they have more power and cooling requirements.”

This increased demand for data centers not only means more electricity to power them, but also more water. Data center operators use water—whether it’s in chillers, cooling towers or air handling systems—to ensure the servers housed inside operate quickly and efficiently without downtime.

For a long time, Levy says, many operators considered water an afterthought, but that’s no longer the case. “Considerations like water scarcity and sustainability are coming into focus,” he says. Plus, it’s more than just a matter of environmental stewardship, but a business imperative.

While projections around the total water use inside data centers vary, researchers at UC Riverside estimate that data centers could withdraw more than 1 trillion gallons of fresh water annually by 2027. But with smart, scalable water strategies, businesses have an opportunity to reduce that impact while improving efficiency. And with the World Resources Institute projecting a 56% gap between freshwater supply and demand by 2030, forward-thinking water management is emerging as a key driver of resilience and growth. “You are anticipating and mitigating risk,” Levy says.

"When you drive down water use, it also lowers energy consumption and greenhouse gas emissions because water requires energy to move, cool and treat, which can create savings."

Calvin Emanuel, Calvin Emanuel, VP and General Manager, Sustainable Growth Solutions, Ecolab

Visibility First

Water management practices have downstream impacts throughout data center operations, says Calvin Emanuel, vice president and general manager, sustainable growth solutions at Ecolab, a global sustainability leader that delivers comprehensive science-based solutions, data-driven insights and world-class service to protect resources vital to life. Scale, corrosion, fouling and microbiological growth can all negatively impact the efficiency and reliability of cooling water systems, potentially shortening the lifespan of equipment and infrastructure assets.

“There’s a hidden cost of water, tied back to operational reliability,” he says.

Water consumption is tied to broader energy costs, as well. “When you drive down water use, it also lowers energy consumption and greenhouse gas emissions because water requires energy to move, cool and treat, which can create more savings,” Emanuel says.

Innovative management can also amplify the advantages of water over alternative cooling methods, like air. “Air-cooled operations require more energy, recasting that challenge from a water management issue to a power generation issue. But when power is generated, it typically involves water usage in the utility provider’s operation,” Emanuel says. “So you still have a water exposure problem, but now tied to elevated greenhouse gas generation.”

Still, experts like Emanuel and Levy note there is no one-size-fits-all blueprint for improving water management practices. “It depends on size, location, application, cooling technology and the vulnerability of local water supplies, among various other factors,” Levy says. “The first step is to be data-driven—to measure everything in a reliable and consistent way.” Recognition that sustainability in data center operations works in tandem with, rather than in opposition to, business performance is critical.

The Technology Behind Water Reduction

With that in mind, Emanuel emphasizes the importance of taking a comprehensive, holistic view of data center operations.

“When Ecolab engages with companies through its Ecolab Water for Climate™ program, the first step is understanding their business and sustainability objectives,” he says. “That gives us a clear understanding of customer goals and any operational constraints. From there, we conduct assessments and engineering audits to uncover actionable insights and develop a tailored blueprint for improvement.”

With a water-management blueprint in place, operators can take an active role in achieving their strategic business goals by leveraging data-driven tools like Ecolab’s Water Risk Monetizer to guide decision-making. This tool models the full business value of water by applying risk-adjusted pricing, helping companies quantify the impact of their water stewardship efforts. “If you’re going to drive change, you need visibility into your water operations,” Emanuel says. “If you can’t see the problem, you don’t know what you need to fix.”

Operators are seeing clear benefits from using digital technologies to act on insights more quickly and effectively. Tools like Ecolab’s 3D TRASAR™ technology use connected sensors and automation to monitor water cooling systems in real time, flagging inefficiencies and prompting timely adjustments. “It’s designed to help data centers respond to rapidly changing impacts on performance,” Emanuel says. In 2024, Ecolab partnered with data center operator Digital Realty to pilot an AI-powered water conservation solution across 35 of its U.S. data centers. The initiative aims to reduce water usage by up to 15%, potentially saving 126 million gallons of potable water annually. The system uses real-time data to identify inefficiencies in water cooling operations and recommend adjustments that optimize both resource usage and performance.

“Artificial intelligence has tremendous potential to transform society in ways we’ve never seen before,” Emanuel says. “At Ecolab, we see this not just as a resource management challenge, but as an opportunity. By advancing digital technologies and optimizing operations, we are helping customers reduce waste, ease pressure on local water supplies and meet business profitability goals while creating a more sustainable future. The promise of AI isn’t just in what it can compute, but in how we choose to apply it to drive greater efficiency, innovation and performance, so that every business location operates at its best.”

Ecolab helps deliver improved business outcomes, operational performance and environmental impact. Learn more.

References

This is an Ecolab paid program in partnership with Custom Content from WSJ. The original article was first published at Paid Program: The Business of Water in the Data Center

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