AI data centers are saving water on-site and spending it at the power plant

What happened

The newer approaches include closed-loop liquid cooling and immersion cooling. Closed-loop systems circulate the same fluid repeatedly instead of evaporating it away.

Liquid and closed-loop systems may increase electricity demand by 6-35% during peak conditions compared with evaporative cooling. AI data centers (a building full of computers that runs online services)' shift to advanced cooling reduces on-site water use but increases power plant water demand, impacting overall sustainability.

12, 2026 As Bloomberg reports, the newer cooling technologies spreading through AI facilities save water at the site itself. They also raise total water use once you count the power plants keeping those facilities running.

Where the water actually goes Data centers have traditionally relied on evaporative cooling. Water absorbs heat from the equipment, then evaporates into the air, taking that heat with it.

Immersion cooling goes further, submerging hardware directly in a cooling liquid. Advertisement Both can reduce or completely eliminate on-site water use for evaporation. More power means more generation, and many thermal power plants use substantial water for their own cooling.