Data Centers Could Overwhelm Community Water Systems Without $10–58B Upgrades
Key Highlights
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Peak-day water demand from evaporative cooling could equal or exceed the daily supply of New York City
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Infrastructure costs to meet data center water spikes could reach $58 billion nationally
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Municipal utilities face dual challenges: financing upgrades and managing finite natural water sources like snowpack and reservoirs
RIVERSIDE, CA — Community water systems across the US may soon face unprecedented stress as artificial intelligence and cloud computing demand ever-larger bursts of water to keep data centers cool, according to a new study from UC Riverside in collaboration with Caltech.
Peak-Day Water Demands Could Rival NYC Supply
The research warns that without major infrastructure upgrades, municipal utilities could need 697 million to 1.45 billion additional gallons of water per day within four years just to meet peak cooling needs—roughly equivalent to the daily water supply of New York City. Even with aggressive water efficiency measures, cumulative demands could reach levels comparable to supplying half of New York City for much of the year.
Evaporative Cooling Drives Massive Spikes
Warehouse-sized data centers rely on evaporative cooling to maintain energy-efficient operations. While annual water use may seem modest, peak-day demand can surge six to 10 times above average, and some facilities under development may see spikes exceeding 30 times typical consumption. On the hottest summer days, a single large data center could withdraw over a million gallons per day, with some projects allocated up to 8 million gallons daily—enough to supply multiple small towns.
Billions in New Infrastructure Required
Meeting these peaks requires more than just pipes. Municipalities must expand treatment plants, storage reservoirs, pumping stations, and wastewater facilities to handle extreme loads safely. Shaolei Ren, Associate Professor at UC Riverside’s Bourns College of Engineering and lead author of the study, estimates costs for the needed upgrades at $10 billion to $58 billion, depending on data center growth rates—assuming adequate water is available.
Water Supply Is a Natural Constraint
“Even if you have money, the water source is another challenge,” Ren said. Many water supplies rely on snowpack and reservoirs, which are inherently limited. Municipal utilities face the dual challenge of financing infrastructure while depending on finite natural resources.
Aging Infrastructure Adds Pressure
The timing coincides with mounting stress on existing systems. The Environmental Protection Agency reports that US water and wastewater infrastructure already requires trillions in upgrades and maintenance over the next 20 years. Local water utilities, most managed by municipal governments, will need to invest strategically to meet data center demands without compromising service to communities.
Recent Industry Moves Highlight the Stakes
In February 2026 alone, three major technology companies secured multi-million-gallon-per-day allocations for new projects in Virginia, Louisiana, and Indiana, with water infrastructure costs approaching $1 billion. The moves illustrate both the scale of corporate demand and the urgent need for municipal planning.
Planning for the Future of Water and Tech
The UC Riverside study emphasizes that preparing for peak water demands—not just annual consumption totals—is critical for balancing the growth of AI and cloud computing with the sustainability of community water systems. Municipalities must act now to build resilient infrastructure that can meet extreme demands while continuing to serve local populations.