Data centers, which are massive facilities housing servers and computing equipment, are often highlighted for their high electricity use. This is especially true for those supporting artificial intelligence (AI) applications, which require significantly more power than traditional data centers. However, these centers also have substantial water needs, primarily for cooling the equipment to prevent overheating. Some of the largest data centers can use up to 19 million liters of water each day—enough to supply a city of 50,000 people. Unfortunately, about 70 to 80% of this water evaporates into the air and is not reused locally, leading to concerns about water sustainability. According to Rystad Energy, an independent Norwegian research firm specializing in energy and economic analysis, the future of water use by data centers depends on a balance between technology and geography, rather than a single breakthrough solution. The firm notes that transitioning to data centers that use less water is possible through the implementation of advanced cooling technologies. One such method is liquid cooling at the rack level, which helps reduce the overall heat generated by the systems and allows for more reliance on dry cooling methods that don’t require water. Rystad Energy predicts that the global direct water use by data centers could nearly triple by 2030, reaching 644 billion liters annually—compared to 222 billion liters in 2025. The most optimistic scenario would see this number drop to 388 billion liters, assuming the widespread adoption of liquid cooling directly on computer chips, as seen in systems like Nvidia Vera Rubin. This approach could significantly reduce evaporation by allowing dry cooling methods to be used more effectively. However, this shift comes with trade-offs. Eliminating water evaporation requires powerful fans to cool the liquid used in the process, which in turn increases electricity consumption. Specifically, the dry cooling system would save about 2.15 liters of water per kilowatt-hour (kWh) of computing power but would use an extra 0.30 to 0.74 kWh of electricity per kWh. This added energy demand raises the issue of "hidden water," which refers to the water used by power plants to generate the extra electricity. In the United States, hidden water already exceeds the direct water use of data centers by more than double. Thus, while reducing on-site water use is a step forward, it shifts the environmental burden to the energy sector, emphasizing the need for greater energy efficiency and reduced carbon emissions at the source.