Tech Giants Face Pressure Over Data Center Water Usage

Major technology corporations, including AMAZON.COM INC, MICROSOFT CORP, and ALPHABET INC-CL A, are facing intensified scrutiny from investors over the environmental footprint of their data center expansions across the United States. Following the recent abandonment of several multibillion-dollar projects due to community opposition, shareholders are now demanding more comprehensive data on water and energy consumption. More than a dozen investors are increasing pressure on tech giants ahead of annual meetings this spring. Trillium Asset Management, which oversees more than $4 billion in assets, filed a resolution with Alphabet in December seeking clarity on how the company will achieve its 2030 climate goals, particularly after reports indicated that its emissions rose by 51% despite a pledge to halve them. Environmental concerns are also extending to the hardware sector. Green Century Capital Management is currently in discussions with NVIDIA CORP regarding a resolution aimed at balancing short-term artificial intelligence growth with long-term climate and financial risks. Water consumption has become a central point of contention. Research from Mordor Intelligence suggests that North American data centers utilized nearly 1 trillion liters of water in 2025, a volume comparable to the annual demand of New York City. While META PLATFORMS INC-CLASS A has reported using closed-loop cooling to improve efficiency, its total water usage at owned sites surged 51% between 2020 and 2024. Investors argue that site-level data is essential for assessing operational risks. While Amazon and Microsoft have reported total water usage, they have historically faced criticism for not breaking down consumption by specific locations in their sustainability reports. Josh Weissman, director of infra capacity delivery at Amazon, noted that the company is moving toward disclosing more site-specific metrics. > "We havent seen them disclosing enough about their water consumption (and the) impact on the local community," said Jason Qi, lead technology analyst at Calvert Research and Management. Industry advocates suggest that transparency is key to maintaining local support for infrastructure projects. Dan Diorio, vice-president of the Data Center Coalition, emphasized that proactive engagement regarding resource use helps residents understand that new developments will not overstress local utilities. > "Being upfront with them regarding energy and water use, and so that residents can understand that this project will not stress their resources... and will protect them as rate payers is crucial," Diorio said. A spokesperson for Microsoft stated that the company is proactively addressing sustainability challenges to ensure long-term impact. Meanwhile, Amazon has committed to investing in efficiency efforts and replenishing water supplies in the regions where it operates.