Global AI Data Center Boom Sparks Local
Backlash with Power and Water Shortages
As tech companies build data centers worldwide to advance artificial intelligence, vulnerable
communities have been hit by blackouts and water shortages.
As major
tech companies like Microsoft, Amazon, Google, Tencent, Meta, and Alibaba
rapidly expand data centers worldwide, communities
from Mexico to Ireland are facing environmental and infrastructure strains.
Data centers require massive electricity and water
resources, leading to blackouts, water shortages, and increased pressure on
already fragile systems.
·
Global
Scope: Nearly
60% of the 1,244 largest data centers are outside the
U.S., with at least 575 more planned. By 2035, data centers
may consume as much electricity globally as India.
·
Local
Impacts:
o
Ireland: Data centers use over 20% of electricity;
authorities have restricted new projects near Dublin.
o
Mexico: Residents near Microsoft’s Querétaro complex report blackouts and
water shortages affecting daily life and health.
o
Other countries: Chile (aquifer depletion), South Africa (grid strain), Spain, Brazil,
India, Netherlands, Singapore, Malaysia, and the U.K. face similar issues.
·
Corporate
and Government Response:
Companies argue the investments bring jobs and innovation and are working on
energy-efficient and water-recycling technologies. Governments offer tax
incentives, cheap land, and regulatory leniency to attract these projects.
·
Community
Pushback: Local
residents, activists, and environmental groups are increasingly resisting,
demanding transparency, accountability, and local benefits. Coordinated
international efforts have emerged, with legal challenges and protests in
multiple countries.
·
Tensions: While companies claim minimal impact, residents
report significant disruptions to daily life, health, and finances,
highlighting a growing conflict between AI infrastructure expansion and
community/environmental well-being.
Key takeaway: The
global AI data center boom is creating economic
opportunities but also serious local environmental and social challenges,
prompting a growing transnational backlash.
The
United States has been at the nexus of a data center boom,
as OpenAI, Amazon, Google, Microsoft and others invest hundreds of billions to build
the giant computing sites in the name of advancing artificial intelligence. But
the companies have also exported the construction frenzy abroad, with less scrutiny.
Nearly
60 percent of the 1,244 largest data centers in the world
were outside the United States as of the end of June, according to an analysis by
Synergy Research Group, which studies the industry. More are coming, with at least
575 data center projects in development globally from
companies including Tencent, Meta and Alibaba.
As
data centers rise, the sites — which need vast amounts
of power for computing and water to cool the computers — have contributed to or
exacerbated disruptions not only in Mexico, but in more than a dozen other countries,
according to a New York Times examination.
In
Ireland, data centers consume more than 20 percent of
the country’s electricity. In Chile, precious aquifers are in danger of depletion.
In South Africa, where blackouts have long been routine, data centers are further taxing the national grid. Similar concerns
have surfaced in Brazil, Britain, India, Malaysia, the Netherlands, Singapore and
Spain.
The
issues have been compounded by a lack of transparency. Google, Amazon, Microsoft
and other tech companies often work through subsidiaries and service providers to
build data centers, masking their presence and revealing
little about the resources that the facilities consume.
Many
governments are eager for an A.I. foothold, too. They have provided cheap land,
tax breaks and access to resources and are taking a hands-off approach to regulation
and disclosures.
Tech
companies, which are racing to build data centers to power
new A.I. models and create “superintelligence,” or A.I. with power that exceeds
the human brain, said the boom brought jobs and investment. They added that they
were working to shrink their environmental footprint by generating their own energy
and recycling water.
Microsoft
said it had no information that its data center complex
in central Mexico had affected power and water supplies. Electricity is unstable
there, the company said. It added that it used minimal water and had an electricity
load of up to 12.6 megawatts, which if used throughout the year would be the equivalent
of what could power roughly 50,000 homes in Mexico.
“We
looked deeply and found no indication that our data centers
have contributed to blackouts or water shortages in the region,” said Bowen Wallace,
Microsoft corporate vice president for data centers in
the Americas. “We will always prioritize the basic needs of the community.”
Electric
grid infrastructure has been problematic in central Mexico and caused blackouts,
said Alejandro Sterling, the director of industrial development for the region.
“Our capacity has been overdrawn,” he said.
Directly
linking any data center to local power and water shortages
is difficult. Yet building in areas with unstable grids and existing water strains
has pressured already frail systems, according to experts, increasing the potential
for cascading effects.
In
country after country, activists, residents and environmental organizations have
banded together to oppose data centers. Some have tried
blocking the projects, while others have pushed for more oversight and transparency.
In
Ireland, authorities have limited new data centers in
the Dublin area because of “significant risk” to power supplies. After activists
protested in Chile, Google withdrew plans to build a center
that could have depleted water reserves. In the Netherlands, construction was halted
on some data centers over environmental concerns.
“Data
centers are where environmental and social issues meet,”
said Rosi Leonard, an environmentalist with Friends of the Earth Ireland. “You have
this narrative that data centers are needed and will make
us rich and thriving, but this is a real crisis.”
There
are few signs of a slowdown. Companies are expected to spend $375 billion on data
centers globally this year and $500 billion in 2026, according
to the investment bank UBS.
In
Mexico, residents said data center development should
come with more investment in their communities. In the village of La Esperanza,
near Microsoft’s site, there was a hepatitis outbreak this summer. Water outages
left residents unable to wash their hands or maintain basic hygiene. The disease
spread quickly, and about 50 people got sick, said Dr. Victor Bárcenas, who runs
a local health clinic.
“I
blame the state governments for failing to negotiate support for the community,”
he said. “Microsoft’s project involved millions of dollars of investment, and none
of it went to us, to the people.”
Horses
roam the 150 acres of open fields in the town of Ennis in western Ireland, which
a developer began trying to turn into a four-billion-euro data center for an unnamed tech company five years ago. Environmental
groups and locals have filed legal objections and appeals to block the project.
Not
long ago, such a plan probably would have sailed through. For two decades, Ireland
rolled out the red carpet for tech. Apple, Google, Microsoft and TikTok made the
country their European base, and about 120 data centers
are clustered around Dublin and dot the countryside beyond. A third of the country’s
electricity is expected to go to data centers in the next
few years, up from 5 percent in 2015.
But
Ireland’s welcoming mood has soured. The country has become one of the clearest
examples of the transnational backlash against data centers.
That
opposition gained momentum in 2021 when an environmental socialist group, People
Before Profit, protested at a data center conference in
Dublin. Around the same time, residents in County Clare, where Ennis is, challenged
the proposed facility that would be built on farmland.
Since
then, a protest movement has grown. Local residents, including the best-selling
author Sally Rooney, have raised concerns. Last year, Darragh Adelaide, an activist
with People Before Profit, was elected to the South Dublin County Council, which
later rejected a data center application from Google.
In
January, storms caused power outages across western Ireland, fueling debates over whether the grid was at a breaking point.
“There’s
a reason why the grid is under strain, and it’s because of the disproportionate
number of data centers,” said Sinéad Sheehan, an activist
who organized a petition against the Ennis project that was signed by more than
1,000 people.
Ireland’s
experience is a warning. By 2035, data centers globally
are projected to use about as much electricity as India, the world’s most populous
country, according to the International Energy Agency. A single data center can also use more than 500,000 gallons of water a day,
nearly as much as an Olympic-size swimming pool.
In
Spain, Aurora Gómez Delgado, an environmentalist who protested a Meta facility near
Madrid in 2023, was stunned when messages of support poured in from abroad. Today
she coordinates with dozens of groups worldwide. Her group, Tu Nube Seca Mi Río
(Your Cloud Dries Up My River), helped inspire the creation of another group in
France.
“There’s
nowhere that doesn’t have a data center,” Ms. Gómez Delgado
said. “We’re coordinated. We’re talking to each other all the time.”
She
and her colleagues said they realized it would be an uphill fight. In Ireland, even
with limitations on data centers near Dublin, the authorities
are trying to expedite the approvals of other sites in rural areas like County Clare
and County Mayo. Many in the business community support further development.
Environmentalists
in Ireland have lost appeals against data center construction
in courts, but hope their actions will deter companies. On Sept. 30, about 50 people
protested outside Dublin’s Parliament against more data centers.
A
final legal appeal against the Ennis data center still
must be heard. Even if the project is greenlit, its future is in question. Amazon
recently revealed it was behind the project and had pulled out, meaning the local
developer will need to find another tech company to partner with.
“We
are committed to being a good neighbor, so we spend a
lot of time listening to and understanding a community’s needs and priorities,”
the company said in a statement.
Welcoming
policies
In
a gleaming office tower wrapped in solar panels and a 3-D LED screen in the city
of Querétaro in central Mexico, an official spearheading the country’s transformation
into a data center hub said interruptions to power and
water were the price of progress.
“Those are happy problems,” said Mr. Sterling,
the director of industrial development for Querétaro, where many of Mexico’s 110
data centers are. “Not for the people that suffer it,
but for the development of the place.”
It
is a refrain echoed, if often less bluntly, by officials elsewhere as they woo tech
companies. Brazil is creating new tax breaks. Malaysia carved out an industrial
zone to attract Chinese and Silicon Valley firms. The United Arab Emirates and Saudi
Arabia ran a diplomatic campaign to get support from President Trump to buy prized
A.I. chips that companies need. The European Union has vowed to spend billions on
new regional data centers.
Darragh
O’Brien, Ireland’s minister for climate, energy and the environment, said construction
was migrating to countries with the most welcoming policies.
“A
very important part of our industrial strategy is being at the leading edge of new
technologies and data,” he said.
Government
support worldwide has helped tech firms build with little accountability, said Ana
Valdivia, an Oxford University lecturer studying data center
development. Few environmental regulations were designed for data centers, and the companies often demand some level of secrecy
from governments.
In
Mexico, Mr. Sterling described an ambitious growth plan that would quadruple total
electricity use from data centers to 1.5 gigawatts over
the next five years, roughly the amount used by 1.25 million American homes. Nondisclosure
agreements with tech companies were needed to win the deals, he said, and he was
required to keep information from communities and Mexico’s electricity utility.
“I
signed that NDA as a public service,” he said.
Project
operators are often camouflaged through subsidiaries or outside contractors. In
Mexico, at least one Microsoft data center is owned and
operated by Ascenty, a Latin American data center company. In Ireland, the would-be Amazon data center was developed by a firm called Art Data Centres.
Company
representatives and government officials said new technology, including cooling
systems that recycle water, was helping to solve the resource strains.
Data
centers “use a lot of water, they don’t waste a lot of
water,” Mr. Sterling said.
Teresa
Roldán, an activist in Mexico, said she was skeptical
of a new proposal in Querétaro to recycle sewage for public drinking water. The
government has said the plan would serve citizens and industry, but data center companies already have direct access to groundwater,
she said. Residents would end up with filtered sewage water, she said.
‘All the electricity’
Microsoft’s
data center complex in central Mexico rises more than
800 feet atop a hill in the high mesquite plains north of Mexico City.
It
is prime land. Locals, including Indigenous groups, had long grazed animals at a
natural spring there. Today, the space is fenced off. Drone footage shows a new
reservoir inside, surrounded by fresh dirt.
Data
centers arrived in Querétaro about five years ago, drawn
by proximity to the United States, relative safety from drug violence and a local
government eager to welcome multinationals.
Microsoft
came first, followed by Amazon and Google. Soon industrial parks buzzed with construction
crews.
Impoverished
small towns in the area, which have struggled with basic services, began experiencing
longer water shortages and more blackouts, according to more than a dozen residents.
“There
are patients with kidney failure who need their machines for treatment,” said Manuel
Rodríguez, a local government representative. “There are people with diabetes who
need to keep their medication refrigerated.”
Mexico’s
national power company attributed recent outages to lightning strikes and stray
animals running into equipment.
Residents
have been hit financially by the power and water disruptions. In Viborillas, a town near the data centers,
Elizabeth Sánchez and her neighbors began experiencing
water outages in June 2024. They now split a $60 fee for private water trucks.
Ms.
Sánchez, a 39-year-old homemaker, has also tossed spoiled food after electricity
outages. A recent blackout fried her daughter’s computer and the refrigerator.
“We
can’t keep up, so we adapt,” Ms. Sánchez said, adding that a part-time job as a
courier has helped defray the costs.
Dulce
María Nicolás, 30, the mother of two in Las Cenizas who
owns a convenience store, said the blackouts had twice forced her to dump rotting
food from her family refrigerator this summer, while prolonged water cuts pushed
her to buy more jugs for storing water.
“It’s
a double cost,” she said. Her children have gotten stomach bugs when the family
cannot wash dishes properly, and school has been canceled
when the toilets did not flush.
The
children were focused mostly on the electricity outages, which deprived them of
their phones. “Technology is all he sees,” she said of her 11-year-old.
The
timing of the problems — after Microsoft’s data center
complex became operational — pointed to one culprit, Ms. Nicolás said. “They have
all the electricity,” she said of the tech company. “I’m left with nothing.”