In Querétaro, Mexico, residents like Sandra García face increasing water shortages while an expanding data centre industry competes for their limited resources. The local water authority, Conagua, reported in May 2023 that 17 out of the 18 municipalities in the state had insufficient rainfall, leading to severe water rationing. Many families, including García’s, struggle to access water, often resorting to filling jerry cans at distant locations to meet their daily needs. This dire situation coincides with Querétaro’s rise as a hub for the data centre industry, which is rapidly growing due to the increasing demands of artificial intelligence (AI).
The state currently hosts 14 data centres, with an additional 19 permits issued, according to the Mexican Data Centre Association. The municipalities of Colón and El Marqués near the state capital are particularly affected. Data centres, often perceived as ethereal entities in the “cloud,” require vast physical infrastructures that consume significant amounts of energy and water. As the demand for AI processing grows, so does the pressure on local resources, raising concerns about sustainability and environmental impact.
Industry Expansion and Local Consequences
The construction of new data centres is driven by major technology firms, which argue that embracing AI is critical for economic growth. They claim that regions resisting this trend risk missing out on potential jobs and tax revenues. Critics, however, highlight the industry’s substantial water and energy consumption, which often comes at the expense of local communities and ecosystems.
A collaborative investigation titled Big Tech’s Invisible Hand, led by Brazil’s Agência Pública and the Latin American Centre for Investigative Reporting (CLIP), reveals that many promises around job creation and economic benefits remain unsubstantiated. The study found that claims of renewable energy usage often mask the construction of new fossil fuel facilities to support data centre operations. This duality complicates efforts to monitor environmental impacts and manage resource consumption effectively.
One of the major challenges faced by data centre operators is cooling. Servers need to maintain stable temperatures, which traditionally requires substantial water use. As AI data centres operate at higher temperatures due to increased processing demands, the need for water intensifies. Sharlene Leurig, a managing member of Fluid Advisors, emphasized that water considerations often take a backseat to real estate and energy costs.
Despite warnings from authorities about the water crisis in Querétaro, data centre construction continues. The local government has been working to attract these facilities, even as it faces drought conditions; in 2024, over 14.8% of the population lacked access to drinking water. Microsoft, for instance, partnered with the United Nations to propose an investment of 82 million pesos (approximately AUD $6.7 million) for local economic development, yet no infrastructure investments aimed at addressing the water crisis have been made.
Seeking Accountability from Tech Giants
Inquiries to data centre giants such as Microsoft, Amazon, and Google about their water consumption and impact on local shortages have yielded limited responses. Microsoft provided a link to a fact sheet but did not directly address concerns about exacerbating water scarcity. Meanwhile, Amazon claims its upcoming data centre in Querétaro will feature designs that minimize water use, aspiring to achieve a water-positive status by 2030.
In Chile, Google faced public protests regarding its data centre’s water consumption after announcing a significant expansion in 2018. The company’s plans were subsequently halted by court decisions that demanded environmental assessments, shedding light on the opposition to unchecked industrial growth. Such situations have sparked discussions about who ultimately benefits from these developments, as many AI data centres primarily support global operations rather than local needs.
Data centres are also proliferating in Brazil, with many located in water-stressed regions. A report indicated that nine out of 14 cities slated for new data centres are classified as having medium to high water risk. Local responses from industry representatives suggest that water availability is not a concern, even as data consumption continues to rise.
The energy demands of these facilities are also a significant issue. The International Energy Agency (IEA) estimates that data centres consumed about 1.5% of global electricity production in 2024, a figure expected to double by 2030. Despite pledges of sustainability, many companies still rely on fossil fuels, prompting fears that the rapid expansion of data centres could hinder global efforts to transition to renewable energy.
As the data centre industry grows, so does the call for transparency regarding resource consumption. The use of non-disclosure agreements by companies often complicates public access to vital information about their operations. Advocates are pushing for greater accountability, urging authorities to require comprehensive reporting on water and energy use to mitigate the adverse effects on local communities.
The ongoing expansion of the data centre industry illustrates the complex interplay between technological advancement and environmental sustainability. As Querétaro and similar regions grapple with the realities of water scarcity, the decisions made today will shape the future of both local communities and the broader environmental landscape.
