MARY LOUISE KELLY, HOST:
A massive data center campus is going up outside Reno, Nevada. And when I say massive, when it's finished, its footprint will be larger than the city next door. All that computer hardware is expected to consume a lot of water, and Nevada is the nation's driest state. Kaleb Roedel with the Mountain West News Bureau reports.
KALEB ROEDEL, BYLINE: Brian Armon, a commercial real estate broker, drives to the Tahoe-Reno Industrial Center.
(SOUNDBITE OF GPS BEEPING)
BRIAN ARMON: Directions to 2555 USA Parkway.
AUTOMATED VOICE: Kuehne + Nagel (ph) Inc is...
ROEDEL: The center rises from the sagebrush like a pop-up book.
ARMON: The building that you see up on the hill there, that's Vantage Data Centers' EdgeCore. That's a data center that's under construction.
ROEDEL: Here, outside of Reno, Arman says tech giants are racing to turn desert land into the backbone of the internet and AI. It checks all the boxes for data centers - plenty of land, few climate-related disasters like hurricanes and flash floods and big tax breaks.
ARMON: We've had a massive amount of data centers that have shown up, and more that are looking.
ROEDEL: By 2027, AI is expected to account for 28% of the global data center market, according to Goldman Sachs. That's more than double its current share. This data center boom is not just happening in northern Nevada. Across the West, including Colorado, Wyoming and Arizona, states have rolled out major tax incentives to attract data centers, but rising concern over their water use is fueling public pushback. In Tucson, Arizona, for example, outcry over a data center project led officials to pull support.
NEWSHA AJAMI: Data centers generate a lot of heat, and the easiest, most efficient way of cooling them down is water.
ROEDEL: That's Stanford hydrologist Newsha Ajami, who says these centers are like thirsty crops, but permanent.
AJAMI: You have to continuously water them, right? So it doesn't provide that flexibility that's needed, especially during dry or drought periods.
ROEDEL: A 2024 federal report found that U.S. data centers consume 17 billion gallons of water a year, but that's a drop in the bucket compared to industries like mining or farming, which use billions of gallons every day. But demand from data centers is expected to double or even quadruple soon, according to that report. And Ajami says in the arid West, where water is finite...
AJAMI: People are concerned about their water and who's using it and how.
ROEDEL: This comes as climate change is shrinking Western snowpacks, says Sean McKenna. He leads hydrologic sciences at the nonprofit Desert Research Institute.
SEAN MCKENNA: And that's not good because snow is like our water tower, right? That's how we store that moisture for later in the year.
ROEDEL: Today, about 75% of the West is in drought. In Nevada, more than half its groundwater basins are overallocated. More water exists on paper than underground. Still, the water district for the data center hub outside of Reno isn't alarmed yet. It holds rights to more than 4 billion gallons a year. Shari Whalen, the district's general manager, says it has the water to handle the center's growth.
SHARI WHALEN: Our plan is not to bring water in from anywhere else. Our plan is to fully and responsibly utilize the resources we have.
ROEDEL: Put another way, she says...
WHALEN: What we're trying to do is make sure that nothing basically goes vertical without a water resource tied to it.
ROEDEL: Several data center developers outside of Reno say they plan to use more efficient cooling systems to reduce water use. That mirrors a broader shift happening nationwide. Dean Ball, an AI policy expert, says data centers are trying to shrink their water footprint.
DEAN BALL: These days, the trend in AI data center design is really to go to closed-loop water systems.
ROEDEL: That means the water is reused over and over. Still, in the driest parts of the country, available water remains a concern and is tightly controlled by regulators. Right now, Nevada has about 60 data centers, with at least a dozen more planned in the coming years.
For NPR News, I'm Kaleb Roedel in Reno. Transcript provided by NPR, Copyright NPR.
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