Iowa’s Data Center Boom: Balancing Growth with a Thirst for Resources

DES MOINES, Iowa – Iowa is rapidly becoming a magnet for data centers, drawn by affordable land, a relatively stable climate, and increasingly, access to renewable energy. But this surge in digital infrastructure is raising critical questions about the state’s – and the nation’s – ability to sustainably support these power-hungry and water-intensive facilities. From concerns voiced by everyday Iowans to debates among industry leaders and environmental advocates, the conversation is intensifying as the demand for data continues its relentless climb.

A Mother’s Worry and the Scale of the Challenge

The tension came to a head at the recent Iowa Data Center Summit, hosted by the Technology Association of Iowa (TAI). Tyler Wyngarden, TAI’s vice president of strategic partnerships, paused during a panel discussion to share a personal concern. “My mom says, ‘I’m worried we’re going to run out of water.’ What would you say?” he asked the assembled experts.

It’s a question resonating beyond Wyngarden’s family. While data centers currently account for less than 0.1% of total water use in the U.S., projections from McKinsey & Co. suggest that consumption could triple by 2030. The stakes are high, especially in a world where, according to the United Nations, 2.2 billion people currently lack access to safely managed drinking water services.

The growth is undeniable. Iowa now boasts 104 data centers statewide, with 76 concentrated in the Des Moines area, according to Data Center Map. Nationally, the number of data centers has nearly doubled in just two years, jumping from 2,701 in 2022 to 5,381 in March 2024, according to Statista.

Industry Responses: Replenishment and Efficiency

Companies like Google are responding to these concerns with ambitious goals. Dan Harbeke, Google’s public policy and government affairs manager, stated the company aims to replenish 120% of the water it uses, and is currently at 66% towards that target. In 2024 alone, Google replenished 4.5 billion gallons of water across its 112 global data center projects.

Microsoft is also investing in water-saving technologies. Their newest data centers utilize advanced direct-to-chip liquid cooling systems, recycling water in a closed loop and eliminating the need for evaporative cooling – a significant water consumer. The company has also committed to becoming “water positive” by 2030, investing $25 million in water infrastructure in West Des Moines, including a new Aquifer Storage and Recovery Well. Currently, Microsoft’s West Des Moines facilities use between 2% and 7% of the city’s monthly water pumping, a figure that pales in comparison to the 40% used for lawn watering during peak summer months.

Beyond Consumption: Location and Energy Demands

However, simply replenishing water isn’t the whole story. Keith Schilling, the state geologist and director of the Iowa Geological Survey, points out that groundwater resources aren’t evenly distributed. “Data centers aren’t necessarily choosing to locate in areas with abundant water supplies,” he explained. “Groundwater doesn’t respect boundaries.”

This is particularly relevant in areas like Des Moines, where groundwater access is limited. Schilling highlighted the contrast with facilities like Google’s near Council Bluffs, strategically located on the Missouri River floodplain with access to substantial groundwater reserves.

The issue extends beyond water to energy consumption. Lu Liu, an assistant professor in water resources engineering at Iowa State University, warns that data centers are “driving up the energy cost” and straining resources in states like Texas, California, and Virginia. She emphasizes the need to consider the long-term impact of data center expansion on Iowa’s energy and water systems, citing observed negative impacts in other regions. According to Accenture, data centers could consume 16% to 23% of U.S. electricity by 2033.

A Two-Tiered Industry and the Future of Infrastructure

The data center landscape isn’t monolithic. Khara Boender, senior manager of state policy for the Data Center Coalition, distinguishes between “hyperscalers” – massive facilities built for companies like Google, Microsoft, and Amazon – and “multitenant” centers, which serve a diverse range of businesses. “Both models are essential,” Boender argued, highlighting the hyperscalers’ ability to meet enormous internal demand and the multitenant centers’ flexibility for smaller businesses.

The demand for this infrastructure is only increasing. A Deloitte study cited by Boender reveals that the average U.S. household now has 21 connected devices, and data generation is expected to double in the next five years. Furthermore, 95% of Fortune 500 companies rely on cloud infrastructure provided by data centers, a number projected to continue growing as the remaining two-thirds of the global population gain internet access.

Policy and Advocacy: A Call for Scrutiny

Wally Taylor, conservation chair and legal chair for the Iowa chapter of the Sierra Club, believes the Iowa Department of Natural Resources’ (DNR) current permitting process for water withdrawal is insufficient. He argues that the DNR is “handing out permits like candy” without adequately investigating the sustainability of these withdrawals. The Sierra Club proposed legislation last year to reform the permitting process, but it failed to reach a vote. They plan to reintroduce the proposal, potentially focusing specifically on data center water and energy usage, in the next legislative session.

MidAmerican Energy acknowledges the growing demand, reporting a 2.8% increase in overall retail load growth in 2023 and 1.5% in 2024, with further increases expected in 2025 due to data center expansion. The company has proposed two new generating projects – an 800-megawatt Solar Reliability Project and a 518-MW natural gas-powered Orient Energy Center – to address the rising demand.

The future of Iowa’s data center boom hinges on a delicate balance: fostering economic growth while safeguarding the state’s precious natural resources. The conversation, sparked by a mother’s worry and fueled by data and debate, is only just beginning.