Data Center Water Use in Texas: HARC Study Flags Rising Risks

On January 21, 2026, the Houston Advanced Research Center (HARC) released a white paper titled “Thirsty Data and the Lone Star State.” The report warns that rapid data center expansion in Texas could strain the state’s finite water resources. We’ll look at current water use, future projections, planning gaps, collateral impacts, and solutions.

Current Water Use Baseline

Today’s data centers in Texas consume about 25 billion gallons of water each year. A mid-sized facility uses roughly 300,000 gallons per day. Larger campuses can draw up to 4.5 million gallons daily. At peak scale, that’s enough water for a town of 10,000–50,000 residents. The industry average runs about 793 gallons per MWh, but high-density sites can exceed 45,000 gallons per MWh when relying on traditional cooling towers.

Projection Scenarios

HARC projects that by 2030, Texas data centers could consume between 29 billion and 161 billion gallons annually. That represents 0.5% to 2.7% of the state’s total water use. These figures rest on ERCOT forecasts of data center energy demand, which anticipate more than 12,700 MW by 2026 and a doubling of that load in 2027. As server farms grow to meet AI and cloud-computing demand, water withdrawals could spike in parallel.

Texas Water Stress and Restrictions

The Texas Commission on Environmental Quality (TCEQ) reports 64 public water systems are already limiting usage to prevent shortages. Severe drought alerts blanket Central Texas and the Rio Grande Valley. Aquifers such as the Ogallala show declining levels after two decades of overuse. Municipal managers face curbs on lawn watering, swimming pools, and nonessential uses even as data centers vie for the same supply.

Policy and Planning Gaps

The core problem is a planning mismatch. ERCOT has built processes to review and approve large electricity interconnections for data centers. However, no statewide mechanism vets their water demand. The Texas Water Development Board (TWDB) relies on self-reported surveys from data center operators. There’s no centralized registry. Compliance varies, and planners lack accurate, up-to-date water‐use data. Meanwhile, the Texas State Water Plan leans on historical consumption trends that predate the AI-driven data center boom. As a result, individual utilities and municipal systems negotiate one-off water contracts with multinational tech firms, often without the leverage or information to protect local water security.

Collateral Impacts

Unchecked data center water use creates multiple knock-on effects. First, further depletion of groundwater threatens farms and ecosystems. Second, power plants generating electricity for these facilities also withdraw water, adding indirect strain. Third, conflicts may flare when fast-growing metro areas see their public water limits shrink under drought orders. Fourth, information gaps favor large tech operators over smaller communities, deepening inequities. Finally, future regulators could impose abrupt restrictions on data center expansion or link operating permits to local water availability, affecting both industry growth and municipal supply.

Technology and Policy Solutions

HARC lays out clear actions to close the planning gap and curb water use growth:

• Require large data centers to report expected annual water and electricity use.
• Integrate forward-looking data center demand into the State Water Plan.
• Offer incentives or rebates for adopting water-lean technologies.

On the technology side, data center operators can cut freshwater demand by deploying:

• Dry cooling: uses air to dissipate heat without evaporation.
• Hybrid cooling: switches between air and water cooling based on conditions.
• Brackish water reuse: treats and recycles high-salinity sources for cooling.

Conclusion

Texas faces a narrow policy window to balance booming data center growth with long-term water security. We can’t afford to wait for crisis-driven restrictions. By improving transparency, modernizing forecasts, and scaling water-efficient technologies, policymakers and industry leaders can protect municipal supplies, support economic growth, and ensure resilience amid chronic drought.