A proposed data center for Equinix Inc. in Minooka could use 30 percent of the municipality’s allocated drinking water.

Illinois is already a top destination for data centers, and more are coming. One small Chicago suburb alone has approved one large complex and has proposals for two more.

Once they’re online, data centers require a lot of electricity, which is helping drive rates up around the country and grabbing headlines. What gets less attention is how much water they need, both to generate that electricity and dissipate the heat from the servers powering cloud computing, storage and artificial intelligence.

A high-volume “hyperscale” data center uses the same amount of water in a year as 12,000 to 60,000 people, said Helena Volzer, a senior source water policy manager for the environmental nonprofit Alliance for the Great Lakes.

Increasingly, residents, legislators and freshwater advocacy groups are calling for municipalities to more carefully consider where the water that supplies these data centers will come from and how it will be managed. Even in the water-rich Great Lakes region, those are important questions as erratic weather patterns fueled by climate change affect water resources.

When it comes to siting data centers, “we don’t see a lot of coordination or long-term thinking about water,” said Michelle Stockness, executive director of Freshwater Society, a nonprofit focused on water preservation. Some places cannot support data centers, she said, “and you’ll have water-use conflicts if you put them there.”

Illinois already has more than 220 data centers, and a growing number of communities interested in the attendant tax revenue are trying to entice companies to build even more. Many states in the Great Lakes region—Illinois, Indiana, Michigan and Minnesota among them—are offering tax credits and incentives for data center developments. The Illinois Department of Commerce and Economic Opportunity has approved tax breaks for more than 20 data centers since 2020.

“Hyperscale data centers are the really large data centers that are being built now for [generative] AI, which is really driving a lot of the growth in this sector because it requires vast data processing capabilities,” said Volzer. “The trend is larger and bigger centers to feed this demand for AI.”

Much of the water used in data centers never gets back into the watershed, particularly if the data center uses a method called evaporative cooling. Even if that water does go back into the ecosystem, deep bedrock aquifers, like the Mahomet in central Illinois, can take centuries to recharge. In the Great Lakes, just 1 percent of the water is renewed each year from rain, runoff and groundwater.

“You have to think of [water] as a bank account. What is the input? What is the output? What is your nest egg in there? And how fast are you drawing it down?” said Carrie Jennings, the research and policy director at Freshwater Society. “That’s where groundwater governance, your Illinois State Water Survey and your empowered local groups that have the right data to work with can think about managing this system.”

In Illinois, 40 percent of the population gets its water from aquifers. In some places, like Chicago’s southwest suburbs in Will and Kendall counties, the amount of water in those aquifers is dwindling.

To ensure that they can supply citizens with safe drinking water, officials from six suburbs southwest of Chicago—Joliet, Channahon, Crest Hill, Minooka, Romeoville and Shorewood—made an agreement with the city two years ago to buy millions of gallons of water a day from Lake Michigan. They are currently building a $1.5 billion pipeline to transport the water, which is expected to be completed by 2030.

Illinois is unique among the Great Lakes states when it comes to water. The Great Lakes Compact each state signed in 2008 bans diversions of water from the lakes to communities outside the basin, but it makes an exception for Illinois thanks to a 1967 Supreme Court ruling allowing Chicago to sell water to farther-flung municipalities.

“We are concerned about the planning of the explosion of data centers, and if these far-out suburbs are actually accounting for that,” said Iyana Simba, city government affairs director for the Illinois Environmental Council. “How much of that was taken into account when they did their initial planning to purchase water from the city of Chicago? This isn’t reused wastewater. This is drinking water.”

Last year, Equinix Inc. proposed building a data center in Minooka. If it’s approved, it could use 30 percent of the drinking water allocated to that municipality from the new pipeline.

The company would prefer to use reclaimed water, according to Michelle Lindeman, a spokesperson for Equinix, and a law passed in May by state legislators explicitly permits that.

The Illinois Environmental Protection Agency already allowed reclaimed water to be used for industrial purposes in certain circumstances, but the agency has only permitted one facility to use treated wastewater discharge. The new law clarifies that companies can apply for permits to use treated municipal wastewater for industrial purposes, and the agency said it will apply existing regulations to approve or deny those applications.

“Where the data centers want to set up is not where we have great water resources [in Illinois], but we do have water reclamation facilities that generate water every day,” said Tim Gualandri, president of the Illinois section of the WateReuse Association. The trade group, which focuses on “recycled water” policy, is working with municipalities and state agencies to develop regulations.

“We just want to tap into that resource so that we can attract industries, grow our jobs and continue to grow economic development here,” Gualandri added.

In Minooka, the village would still have to develop the infrastructure to get reclaimed water to the data center.

Non-disclosure agreements that companies ask municipalities to sign when they propose a data center further obscure how much water is needed and where it would come from, making it difficult to determine whether municipalities have enough supply, said Volzer, with Alliance for the Great Lakes.

To help combat that, some states in the region like Ohio and Indiana are now conducting regional water-demand studies, which would help communities determine where water is available before approving a data center. Some water managers are also conducting those studies in Illinois, but they are not required.

A bill proposed in February by Illinois state Sen. Steve Stadelman would have required data centers to disclose how much electricity and water they use, but lawmakers failed to vote on it before the legislative session ended May 31.

“The Great Lakes region is seen as water-rich. And it’s true, we have a lot of water here, but there’s an important detail not to be missed: Water abundance requires proper management to ensure that it’s available going forward,” Volzer said. “Our surface water is connected to our groundwater supply.”

Ordinances in other Great Lakes states could serve as a model for how to regulate water diverted to data centers, she added. In Michigan, for example, companies proposing data centers must show that there is enough existing water supply to support the facility in order to get the state tax incentive.

“With all of this demand, and with climate change, it seems prudent to start making these legislative changes now,” said Volzer.