Data centers have been around for quite a while now, panelists at SXSW’s Dirty Data: The Hidden Climate Cost of Our Digital Lives reminded their audience Tuesday afternoon.
“We’ve watched Netflix for a long time. We’ve asked Google questions for a long time,” said Thomas Sisto, CEO and co-founder of the energy storage company XL Batteries.
What’s new are AI data centers specifically, and they use up a lot more energy and water resources, issues that have been at the forefront of community mobilization efforts against data centers in the Austin-area.
On the energy side, while a standard data center typically uses 50 to 100 megawatts of power, an AI data center can use up one or 1.2 gigawatts, enough to power 90,000 homes, panelist Anurag Bajpayee, CEO of the water and wastewater strategies company Gradiant, explained.
And our country’s power generation has stayed pretty much the same over the last 10 years, Sisto reminded the room.
The chips in a data center hall undergo massive load spikes with individual AI requests, Sisto explained, which can destabilize an energy grid. “Imagine if 50,000 homes just completely went dark instantaneously, and then 30 milliseconds later, came back on. That’s what we’re talking about,” he continued. “So when you start to get into 250 megawatt, 500 megawatt data centers, it literally will black the grid out. And nobody really knows what to do.”
On the water side, the Houston Advanced Research Center estimated in January that existing data centers in Texas consumed approximately 25 billion gallons of water in 2025, which could increase to 161 billion gallons a year in Texas by 2030, even as severe drought and population growth strain our state’s resources.
But water and energy aside, there’s more to worry about, panelist Breana Wheeler, director of U.S. operations at BREEAM, which creates sustainable building standards, told the room. Other problems associated with data centers aren’t being talked enough about: electronic waste, heat production, and air and noise pollution.
Electronic waste (e-waste) are the cords and hardware discarded by data centers that can contain harmful chemicals like lead and mercury, resulting in pollution of the water, soil, and air. “The electronic waste that’s going to be created from these facilities, where does it go? What happens to it? What’s in it? How do we reuse it?” Wheeler questioned.
We’ve also entered an era when data centers are necessarily becoming their own water utilities, power plants, and wastewater facilities to appease their own energy demand, Wheeler added.
“We’re not just placing data centers in our communities,” she emphasized. “We’re also placing mini power generation units, and that is something different than just a building that’s computing and maybe putting off some heat.”
In perhaps typical tech-y SXSW fashion, the assumption from panelists was that data center expansion is here to stay. With that being the case, the panel explored ways to minimize their inevitable harm and vacuum of resources. “Take lemons and let’s make lemonade. How do we make this a community benefit, more than just an extraction of resources?” Wheeler said cheerfully.
The heat generated by AI data centers could be funneled to warm homes, pools, or agricultural greenhouses, Wheeler suggested, noting that some of those projects already exist.
Data centers have also been exploring how to make closed-loop water systems lose less water. Closed-loop systems are supposed to recycle and reuse the same water to cool the equipment after a typically large initial water load, but with evaporation, the loops still need periodic refills.
“When water evaporates, it concentrates. Concentrated water is no longer fresh water. … It starts becoming brackish, and then more saline, and then more like brine. You can’t use it,” Bajpayee pointed out.
Gradiant is working to treat the brine back to water quality where it can rejoin the loop. “If a medium-sized data center uses 7,000 households worth of water, if you can truly achieve 1-2% of that … now it’s suddenly more reasonable for a small town that may be near that data center,” Bajpayee said.
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