Communities from Thane to Melbourne are pushing back as hyperscale data centres consume large volumes of water, draw prioritized power, and change land use — forcing governments and companies to confront environmental and social trade-offs.
A 100 MW hyperscaler data centre can use nearly 2 million litres of water per day for on-site cooling — roughly the supply for 15,000 urban residents.
Host regions face policy choices: compete for investment with concessions that prioritize data centres for power during outages, or tighten environmental and planning rules to protect communities.
# What's happening
# Concrete impacts cited by residents and reports In Thane, a housing society that welcomed a tech investor found out the plot would house a data centre. Residents now face multi-day water cuts and several-hour power outages in summer. Similar local resistance has appeared in Melbourne and in parts of Europe.
Energy, Environment and Water (CEEW) estimates a 100 MW hyperscaler data centre typically needs nearly 2 million litres of water a day for on-site cooling. That quantity is comparable to supplying about 15,000 urban residents.
Power demand for AI workloads is higher than for conventional business applications. While legacy enterprise centres use about 5–15 kW per hour, AI facilities with high-performance GPUs need 40–60 kWh and can exceed 100 kWh for intensive training setups. Global electricity consumption by data centres was about 1.5% in 2024, with CEEW projecting demand could double to 945 TWh by 2030.
# Technical and land-use pressures Rack power density is rising quickly. Industry figures show an average of 36 kW per rack in 2023, with expectations around 50 kW by 2027. That shift changes cooling and electrical infrastructure needs and increases fuel and backup-generator usage.
# Policy and regulatory flashpoints Many communities ask for clear, accessible documents: zoning classifications, development plans, permissions and the specific laws officials used to approve projects. Activist groups have pressed local authorities to disclose water sources and environmental clearances.
Some Indian states already treat data centres as high-priority for power supply, on par with hospitals. That classification can mean data centres receive preferential restoration in outages, creating perceived or real disadvantage for residents. States often run separate power grids for such facilities, raising questions about fairness and resilience planning.
# Examples on the ground Visakhapatnam was chosen by Google for a planned 1 GW facility, in a region the Central Ground Water Board described in 2025 as having "overexploited" groundwater. In Thane, the WakeUp Thanekar group wrote to authorities seeking precise legal and planning details for an Amazon data centre site. In Melbourne, residents highlighted the physical footprint and relentless noise of a proposed centre.
# Decisions for officials and companies Local governments face a trade-off: attract hyperscaler investment with incentives and relaxed approvals or protect community water, power and land resources with stricter controls and transparency. Companies must weigh the reputational and operational costs of pursuing sites where local resources are scarce or contested.
# Where this goes next Expect increased public demand for transparency about resource sourcing, clearer environmental approvals tied to generator use and chemical handling, and possibly new local regulations limiting siting in water-stressed or densely populated regions. Political responses will vary: some jurisdictions may accelerate approvals to win investment, while others tighten rules to reduce community impacts.
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