Major technology operators including Nvidia, Microsoft, Amazon Web Services, and Meta are transitioning to closed-loop and air-cooling systems in their data centers. While these technologies decrease direct water consumption at the facility site, they require higher electricity usage to operate.
The Lawrence Berkeley National Laboratory reports that this shift increases indirect water consumption at thermoelectric power plants that generate the necessary electricity. This trade-off effectively moves the water demand burden from the data center location to the power generation source.
These cooling developments are influencing regulatory discussions in Texas regarding a potential moratorium on data centers. Key entities involved in these policy deliberations include the Texas Commission on Environmental Quality and the Electric Reliability Council of Texas.
Stakeholders are monitoring potential legislative or executive actions from Texas Governor Greg Abbott. Additionally, industry observers are tracking announcements from major utility providers and future audits by the Electric Reliability Council of Texas for signs of policy changes.
