Inside the News
Microsoft CEO Satya Nadella says the company’s newest AI data centers use extremely low amounts of water.
The new facilities reportedly consume roughly the same amount of water annually as a single restaurant.
Microsoft is using a closed-loop cooling system that recycles water instead of constantly drawing fresh supplies.The move comes as AI companies face growing scrutiny over the environmental impact of large-scale data centers.
Microsoft CEO Satya Nadella has said the company’s latest generation of AI data centers is dramatically reducing water consumption through advanced cooling technology.
Speaking at Microsoft Build 2026, Nadella stated that some of Microsoft’s newest AI facilities use roughly the same amount of water in a year as a single restaurant.
The improvement comes from a closed-loop liquid cooling system that recirculates water rather than continuously consuming fresh water for cooling servers. Microsoft says the cooling loop is filled once and then reused, significantly lowering water requirements.
The technology is being deployed in Microsoft’s new AI-focused data centers, including its Fairwater campus in Wisconsin, which is designed to support next-generation AI workloads.
The announcement comes as concerns grow over the environmental impact of AI infrastructure, particularly its energy and water consumption. Microsoft says reducing water usage is part of its broader sustainability and “community-first” AI infrastructure strategy.
The development highlights how major AI companies are increasingly focusing not only on building more computing power, but also on making that infrastructure more sustainable.
Understanding the Terms
Data Center: A facility that stores and runs powerful computers and servers.
AI Infrastructure: The technology and systems needed to build and run AI models.
Closed-Loop Cooling: A system that reuses the same water repeatedly instead of consuming new water.
Sustainability: Using resources in a way that reduces environmental impact.