As the UK races to become a global AI leader, the infrastructure powering this ambition – data centres – is under scrutiny. A new techUK report reveals that water use, not just energy, is a growing concern. With climate change intensifying and digital demand surging, clients must understand how cooling technologies, regulation and design choices will shape the future of data infrastructure. This article explores the legal and strategic implications for operators, investors and developers.

Published  21 August 2025

While energy consumption has long dominated the sustainability conversation, water use is now emerging as a critical focus. A recently published techUK report, developed in collaboration with the Environment Agency, offers a timely and data-driven look into how England’s commercial data centres use water, dispelling myths and highlighting opportunities for sustainable growth.

Why water use matters

Data centres are the backbone of modern life, enabling everything from cloud computing and financial transactions to emergency services and AI workloads. Their designation as Critical National Infrastructure (CNI) in 2024 underscores their strategic importance. However, as climate change intensifies and digital demand grows, understanding and managing water use becomes essential.

Cooling is the primary reason data centres use water. Servers generate significant heat, and operators must choose between various cooling technologies - air, refrigerant, or water-based - based on local climate, energy availability, and water stress. While water-based cooling can be efficient, especially in energy-constrained areas, it raises concerns in regions facing water scarcity, both today and as a result of future climate change.

Key findings from the survey

techUK’s survey of 80 data centre sites across England (with 73 valid responses) reveals encouraging trends:

• 51% of sites use waterless cooling systems, relying on air or refrigerants.

• 64% consume less than 10,000 m³ of water annually, comparable to a leisure centre.

• 89% either measure water use or operate systems that don’t require water for cooling.

These findings challenge the perception that data centres are major water consumers today. While their water footprint is modest compared to other sectors, the projected growth of the sector means that responsible water usage is critical to ensuring future sustainability.

Technological and design innovations

The industry is actively adopting advanced cooling technologies to reduce water dependency. Closed-loop systems, direct-to-chip cooling, and immersion cooling are gaining traction, especially for high-performance computing and AI workloads. Operators are also exploring alternative water sources such as rainwater harvesting, treated effluent reuse, and on-site storage.

Design choices are increasingly informed by local water stress. In water-scarce areas, operators opt for air-based or refrigerant cooling, while water-abundant regions may support evaporative systems. Importantly, chip manufacturers’ specifications influence cooling needs, and higher operating temperatures (~32°C vs. ~25°C) can reduce both energy and water requirements.

Industry standards and commitments

The sector uses clear guidelines to help manage water use responsibly. One common measure looks at how much water is used to power digital equipment, helping operators track and improve efficiency. Most data centres in Europe have signed up to a major environmental agreement that sets tough targets for saving water, especially in areas where it’s scarce. In addition, operators follow international standards that provide practical steps for monitoring and reducing both energy and water use. These efforts help ensure that sustainability is built into how data centres are designed and run, as well as having the potential to reduce operational costs.

Next steps

To support sustainable growth in the UK’s digital infrastructure, techUK recommends fast-tracking reservoir construction, publishing a Water Exploitation Index for river basins, and reforming the water sector with a digital-first strategy; measuring and reporting Water Use Efficiency (WUE), joining the Climate Neutral Data Centre Pact (CNDCP), and designing cooling systems based on local water availability; and fostering collaboration through public-private partnerships to upgrade water infrastructure and develop standardised cooling requirements for AI-ready servers.

Data centres are indispensable to the UK’s digital future, and while most commercial facilities in England already operate with low water intensity thanks to innovation and industry standards, the growing impact of climate change is expected to intensify water stress across many regions. This added pressure means that ongoing cooperation between government, industry, and regulators will be crucial to ensure data centres remain both resilient and environmentally sustainable as the demand for digital services and AI continues to rise.