AI’s Thirst for Cooling Water Signals Higher Costs for Commercial Facilities

ISTA, CA — AI-driven data centers are creating an unprecedented surge in water demand across the United States, raising concerns about long-term water availability and its impact on utility costs for commercial facilities.

Recent estimates show AI data centers consumed 17 billion gallons of water in 2023, with usage projected to reach 68 billion gallons by 2028—a nearly 300% increase in just five years.

“Never in the history of this country has demand for water increased so dramatically in such a short time,” says Klaus Reichardt, CEO and Founder of Waterless Co., Inc. “This water consumption crisis will obviously reshape utility costs for businesses and consumers nationwide.”

AI Workloads Require Enormous Cooling Capacity

Behind the surge is the cooling demand of high-performance processors running AI models. Water usage accumulates quickly:

• A single ChatGPT query uses roughly one-fifth of a teaspoon of water.

• With over one billion interactions daily, that small amount scales dramatically.

• Total water consumption for AI data centers hit 17 billion gallons in 2023 and is expected to rise to 68 billion gallons by 2028.

AI processing loads continue to grow, and many legacy cooling systems were not designed for this thermal output.

Why Cooling Demand Is Increasing

Unlike traditional data centers, AI facilities rely on:

• Higher-density compute racks generating intense heat

• Round-the-clock cooling requirements

• Rapid model growth that pushes systems harder each year

• Expansion of AI services across every business sector

These systems require constant, high-volume cooling, much of it water-dependent.

Data Centers Are Concentrated in Water-Stressed Regions

Many AI data centers are strategically located in arid regions to leverage low-cost solar power. While renewable energy reduces carbon footprints, it also places heavy water demand on areas already facing long-term scarcity. This creates a “perfect storm” of rising cooling loads and declining local water availability.

Businesses Should Expect Higher Water Costs

As AI facilities compete for limited resources, utilities in affected regions are expected to increase rates. Any industry that depends on water—as part of its operations, sanitation, production, or building systems—will feel the impact.

Industries likely to be hit hardest include:

• Production and manufacturing

• Hospitality and food service

• Healthcare

• Commercial real estate

• Agriculture and food processing

Near-Term Steps for Commercial Facilities

“Obviously, the owners of these AI data centers know something must be done and quick,” says Reichardt. “However, technological solutions will take time to implement. The best thing we can do right now is use water more efficiently, which creates a long-term reduction in water consumption.”

Waterless Co., Inc. recommends that building owners, mechanical contractors, and facility operators take immediate action:

1. Audit existing water use to pinpoint inefficiencies.

2. Install water-saving technologies, including waterless urinals and low-flow fixtures.

3. Evaluate and optimize cooling systems for improved efficiency.

4. Track water costs closely and plan for rate increases.

5. Build water-conservation strategies now—before shortages intensify.

Planning for a Sustainable Water Future

As AI continues expanding into every industry, its cooling demands will intensify. Coordination between tech companies, utilities, and commercial operators will be essential to manage water resources sustainably and avoid severe cost and supply shocks as 2028 approaches.

For more on data centers and their role in the new construction economy:

Contractors Report Cautious Outlook as Backlog Slides to 8.4 Months

Contractors Face Record Data Center Demand as AI Drives Market Expansion

Infrastructure and Data Centers Drive Construction Confidence in September

Note: this release was rewritten with help from generative AI.