For all the talk about data centers, they can be pretty unassuming up close.
Especially in Phoenix — a city full of office parks and industrial warehouses — it can be easy to drive by an unlabeled, windowless four-story building without knowing what's inside.
Drivers speeding by the Aligned Data Centers facility in north Phoenix probably don't register the stout gray-and-blue building on the side of the freeway. Downtown, a QTS Data Centers building sits quietly between hotels and and parking garages, doing little to announce its presence to the throngs of college students, conference attendees and sports fans that walk by on any given day.
Generally, researchers say, the amount of water used inside the four walls of these nondescript buildings is lower than most people think. However, they demand massive amounts of electricity, and power plants can use a lot of water while working to meet that demand.
Ultimately, though, there is relatively little data on how much water is used to make electricity in Arizona, and analysts say it is hard to get a complete understanding of data centers' water demands without more transparency from electric utilities.
How do data centers use water?
Just like the buildings that house data centers can blend in to the rest of the Valley's urban sprawl, their water use often doesn't stand out either.
Data centers mostly use water for cooling.
Inside one, you'll find rows and rows of servers — big computers designed to send and receive data. Those computers get hot while they're running, just like your laptop gets warm when you have a lot of browser tabs open.
Different data centers use different technology to keep servers cool. Many of them run chilled water through special pathways inside the computers, absorbing the heat and carrying it away.
Some use little to no water for cooling. Aligned Data Centers declined to be interviewed for this story but sent a written statement to KJZZ, which said its facilities are "engineered to require zero water for operational cooling" and rely on a closed-loop system that cools their equipment without continuously drawing from city pipes.
Estimates about the amount of water it takes to run an AI prompt or use a chatbot often make the rounds on social media. They often include quippy lines that reduce AI's water use to a digestible ballpark number. "Every time you ask AI a question, it drinks a bottle of water," writes an Instagram post from earlier this year.
Sarah Porter, director of Arizona State University's Kyl Center for Water Policy, said those posts can be misleading.
"Those are all sort of fun back-of-the-envelope estimates that get people to think, and I think it's good that people think about that," Porter said. "But they're not accurate. They're not meant to be precise."
Porter said the data center cooling process uses a relatively modest amount of water.
Kathryn Sorensen, the Kyl Center's director of research, understands why people are concerned about big water users in a dry state struggling with drought, climate change and mandatory cutbacks to one of its most important water supplies. But data centers themselves, she said, often use similar amounts of water to other big users, like beverage bottlers and golf courses, which generally receive less public pushback.
Sorensen and Porter penned a report on Central Arizona's large water users, including data centers, and said there's a key reason data centers have relatively low on-site water use. Because most of them are located in cities, local water utilities keep a close eye on how much they're using.
Basically, most cities will not allow a data center to plug into their water system if they think it will cause taps to go dry for people who live there.
Sorensen, who used to run the city of Phoenix water department, said that provides an "important guardrail" to keep data centers from using too much water.
"Cities don't have the luxury of just accepting whatever comes," she said. "They have to look at each and every proposed water use and make sure that it fits with their community's needs over the long term."
In some cities, there's a law on the books that forces the local government to scrutinize big new water users before they set up shop.
The city of Phoenix, which is home to the largest share of all existing and planned data center campuses in Central Arizona, has such a law, called a "large water user ordinance." Since 2024, anybody who wants to use 250,000 gallons or more per day has had to send a special application to the city's water department, including strategies to use water efficiently and reduce waste.
Phoenix's water director then has the "sole and absolute discretion" to block any big new project that could threaten the city's broader water supply.
As of 2025, at least nine Arizona water utilities have passed similar rules, including most major cities in the Valley.
Even though Arizona's water supply — especially its take from the Colorado River — is getting squeezed by drought, climate change, and steady demand, cities generally have plans to keep taps flowing for decades. If data centers weren't plugged into those carefully-managed city water systems, Sorensen said, they would be cutting into a finite supply of groundwater.
"An existential threat for the Phoenix area is depletion of groundwater," she said. "So to the extent we can avoid that, that's a really good thing. So I think absolutely the most sustainable way to meet the water demands of these data centers is with municipal tap water."
Electricity demand is water demand
If you want to know why data centers are causing some hand-wringing about water, you have to look beyond the data centers themselves.
On the dusty desert fringes of the Phoenix metro, about an hour west of many controversial new data centers, massive towers and power lines rise up from the horizon. Redhawk Power Plant, a massive natural gas facility owned by Arizona Public Service, is undergoing a big expansion. That expansion aims to add 397 megawatts to the energy grid, enough to serve 63,520 Arizona homes. APS declined KJZZ's request for an interview.
Researchers say power plants like this Redhawk, scattered throughout the Valley, are a bigger part of data centers' appetite for water than the facilities themselves.
Data centers use massive amounts of electricity. The amount of electricity it takes to power an average data center is roughly equivalent to the power needed for 400 Costco warehouses, according to an APS official.
It takes a lot of water to generate that power, and the need for those generating stations is growing.
A study by the nonprofit advocacy group Ceres found that annual water use associated with data center electricity needs could increase by as much as 400% if planned data centers are constructed. The increase would bring data-center-driven water use at power plants to 14.5 billion gallons per year, about enough water to supply a city of 240,000 people — roughly the size of Scottsdale — for over two years.
Data centers are working to make their technology and water use more efficient, but so many of them are coming online in a short period of time that the benefits of those improvements could be wiped out if dozens of new facilities are built in the same area.
"Our research shows that data centers, if implemented in unsustainable ways, could bring about a lot of negative impacts," said Kirsten James, senior program director for water at Ceres. "So we really need to do this the right way and be thoughtful."
Water is pivotal for generating electricity at gas, nuclear, and coal plants. Those facilities boil water to create steam, which spins a turbine to generate electricity. Then, using other water, that steam needs to be cooled down and turned back into water.
Demand for power — including demand driven by new data centers — has forced the development of new power plants and driven up the overall need for water. The amount of electricity used to power a data center can vary greatly from facility to facility, and so can the amount of water used to generate electricity, making it hard to arrive at specific numbers about the amount of water demand generated by data centers.
Natural gas is the single largest source of electricity generation in Arizona. In 2024, it was responsible for 45.6% of all electricity in the state, according to the U.S. Energy Information Administration.
The amount of natural gas plants in the state is set to go up. The environmental nonprofit Sierra Club counts 19 new gas plants planned or under construction in Arizona.
A 'very concerning' lack of transparency
Industrywide estimates about the amount of water used in natural gas generation can provide some clues, but it's hard to tell exactly how much a specific power plant actually uses, especially in Arizona.
"Utilities have a long history of being extremely politically powerful," said Keriann Conroy, a research associate at the Energy and Policy Institute, a utility watchdog group. "It serves their interest to have sort of this degree of opaqueness around their resource use."
Conroy has tried to compile data on the amount of water used for electric generation in Arizona, but ran into roadblocks. The Arizona Corporation Commission, which regulates the state's utilities, does not require them to report water use at generating facilities, which she called a "huge issue" in a state with limited access to water.
Conroy says that leaves the public with little more than "ballpark estimates."
"Because water is such an important issue to voters," Conroy said, "It should be very concerning that we don't even have a very good inventory of how much water we're actually using for electricity generation."
In a poll conducted earlier this year, 90% of Arizona respondents said it was important for state and federal officials to prioritize water security around the region.
Conroy said the lack of information around water use validates some of the public worry over data centers.
"Often these concerns about data centers are kind of shrugged off as not understanding the problem, and I don't think that's true," she said. "I think there are a lot of unanswered questions, and we see that with how much data is unavailable to us."
The amount of data centers in the Phoenix area is expected to increase significantly. Across Arizona, there are 172 data centers operating or in development, according to Data Center Map, an independent website that tracks nationwide data center development. "Things are moving very quickly," said Kirsten James, who co-authored the report by Ceres. "So I think we really need to look at these facility by facility."
James said high water use caused by data centers and their demand for power could actually pose a financial risk for the companies that own them — either because they try to operate in an area that doesn't have enough water available over the long term, or because concerned locals try to block them from doing business.
Companies and communities alike, she said, need to work to make sure data centers do not put too much pressure on water in places that are in short supply.
"Our research really shows that data centers, if implemented in unsustainable ways, could bring about a lot of negative impacts," she said. "So we really need to do this the right way and be thoughtful."
This story was produced by the Mountain West News Bureau, a collaboration between Boise State Public Radio, Wyoming Public Media, Nevada Public Radio, KUNR in Nevada, KUNC in Northern Colorado, KANW in New Mexico, Colorado Public Radio, and KJZZ in Arizona as well as NPR, with support from affiliate newsrooms across the region. Funding for the Mountain West News Bureau is provided in part by the Corporation for Public Broadcasting and Eric and Wendy Schmidt.
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