Texas has long been defined by oil, heat, and huge infrastructure projects. Now, it’s also at the center of a growing environmental debate. Microsoft’s Stargate campus in Abilene is leading a data center boom that is drawing concern over water use, right in the middle of a prolonged drought.
According to a July 2025 investigation by The Austin Chronicle, data centers across Central Texas are consuming millions of gallons of water every day. This comes as many residents are being asked to reduce their usage due to dwindling supplies.
The problem is not limited to one city. In San Antonio, Microsoft and U.S. Army Corps facilities used a combined 463 million gallons of water in 2023 and 2024, according to local water utility SAWS. That’s the equivalent of usage for tens of thousands of households.
Stargate and the scale of AI
The Stargate campus in Abilene is expected to become one of the largest AI data centers in the world. Microsoft has partnered with OpenAI to develop advanced infrastructure capable of supporting the next generation of large language models. What’s received far less attention is how much water it will take to keep that infrastructure running.
“These centers are showing up in places that are very water-stressed, said Margaret Cook, a water policy analyst at the Houston Advanced Research Center. There’s no requirement for them to have conversations with communities about how much water they’ll use.”
Cook pointed out that these projects often break ground with little notice, largely due to regulatory loopholes. Texas law prevents most local authorities from regulating or even tracking how much water a facility consumes.
A surge with little oversight
According to the Chronicle article, a white paper submitted to the Texas Water Development Board projected that data centers in the state will consume 49 billion gallons of water in 2025. That number is expected to rise to 399 billion gallons by 2030, nearly 7% of the state’s total projected water use.
“People don’t think of data centers as industrial water users, but they are,” said Robert Mace, executive director of The Meadows Center for Water and the Environment at Texas State University.
In the Hill Country region, where several new AI-focused centers are under construction, locals are sounding the alarm. Not only do these facilities demand significant water for evaporative cooling, but much of that water evaporates and cannot be recycled. While some facilities rely on recycled water, many still draw heavily from drinking water supplies.
“Once that water evaporates, it’s just gone,” Mace told The Austin Chronicle.
Industry says sustainability is the goal
Microsoft has pledged to be water positive by 2030, meaning the company aims to replenish more water than it consumes. It has launched water restoration projects and emphasized the use of recycled water where possible. However, critics argue that these efforts often take place far from the communities being directly affected.
“You have to question what ‘water positive’ means when you’re building massive projects in places already dealing with water scarcity,” said Cook.
The lack of transparency has also been a recurring issue. Some water utilities only find out about a data center’s plans after construction is well underway. In some cases, companies operate under shell entities or code names, limiting community awareness and input.
Why it matters now
This is not a future problem. Texas is already experiencing severe drought conditions across multiple regions. As AI continues to scale, so does the demand for infrastructure and the natural resources to support it.
The push toward larger and more complex AI models means data centers will only become more critical. But unless water use is managed more transparently, the tech that powers our chatbots could come at a high environmental cost. For many Texans, the future of AI feels like a trade-off – progress powered by water they may no longer have.
