Data centers can increase demand for electricity, water, and supporting infrastructure, but their effects on household bills, local water supplies, and employment depend on where they are built and how their costs and benefits are handled. National estimates show the scale of the trend—not what a particular project will mean for a town. To judge a proposal, look for its projected power and water use, who pays for upgrades, and how many lasting local jobs it commits to provide.
How much electricity do data centers use?
Data centers use electricity to run computing equipment and to operate systems such as cooling. The United States’ most recent well-described historical national baseline in the available estimates is for 2023: Lawrence Berkeley National Laboratory (LBNL) estimated data centers used 176 terawatt-hours (TWh), or 4.4% of U.S. electricity that year. This is a historical estimate for 2023, not a measurement of electricity use in 2026.
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LBNL’s June 2026 update models much higher use by 2030. Its reference case estimates 649 TWh, equivalent to 11.8% of U.S. electricity use. The report gives a compounded-uncertainty range of 521–843 TWh and a range of 9.5%–15.3% of U.S. electricity use across scenarios. These are modeled futures, not guaranteed outcomes. The estimates use projected equipment shipments and per-device electricity use, along with cooling simulations and assumptions about facility types and locations.
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|---|---|---|
| Data-center electricity use | 176 TWh; 4.4% of U.S. electricity | 2023 historical estimate; LBNL’s December 2024 report |
| Data-center electricity use | 649 TWh; 11.8% of U.S. electricity | 2030 reference case; LBNL’s June 2026 modeled estimate |
| Data-center electricity use | 521–843 TWh; 9.5%–15.3% of U.S. electricity | 2030 compounded-uncertainty and scenario ranges in LBNL’s June 2026 update |
These figures describe national energy use over a year. They do not say how much power a particular facility will draw at its busiest hour, whether a local grid can serve it with existing equipment, or how much an individual customer will pay. Annual energy use and peak demand are different measures: a utility planning for a new large load needs to understand both.
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Do data centers raise electricity bills?
They can put pressure on electricity systems, but the national estimates do not establish a single effect on household bills. A data center’s demand is not the same thing as the retail price paid by a household. The bill impact depends on the costs a project triggers, the terms under which the utility serves it, and the rules for assigning those costs and risks among customers.
How a large new load can affect costs
A utility may need to add or upgrade generation, transmission lines, substations, or local distribution equipment to serve a facility. It may also need enough dependable resources to meet demand when the grid is constrained. If costs are assigned to the developer or to a special customer class, the consequences differ from a situation in which other customers share them. The timing matters too: infrastructure built for a project may be in place before the facility opens, and the expected load may change or fail to materialize.
The U.S. Department of Energy’s Office of Policy identified fair allocation of electricity-system costs, avoiding unfair transfers to other customers, stranded-investment risk, and resource adequacy as rate-design issues in its January 17, 2025 brief. The brief also discusses options such as onsite generation and matching electricity use with carbon-free resources. These are issues for regulators and utilities to address, not proof that every project will follow one particular arrangement.
What determines a customer’s bill impact
Local tariffs, regulatory orders, grid conditions, project agreements, and the schedule of upgrades all matter. A developer’s statement that it will pay for power or infrastructure is not equivalent to an approved tariff or contract, and neither by itself proves what customers ultimately paid. An observed increase in household bills also does not show that a data center caused it; other costs and decisions can affect rates at the same time.
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When reviewing a local proposal, look for utility filings and regulator decisions that specify which upgrades are needed, who is responsible for them, how charges are calculated, and what happens if projected demand is delayed or lower than expected. A broad claim that a project will either raise everyone’s bills or leave residents fully protected is not supported without those local details.
How much water does a data center use?
There are two distinct water questions: how much water a facility uses directly, and how much water is consumed to generate the electricity it uses. The figures are not interchangeable, and neither national total predicts the impact at an individual site.
Direct water use at the facility
Direct water is used at the data center, often in connection with its cooling system. The amount and timing of use depend on the facility’s cooling design and operation. LBNL’s December 2024 report estimated 66 billion liters of direct data-center water consumption in the United States in 2023. This is a modeled national aggregate for that year, not a per-site average or a promise about how much water a proposed facility will need.
Indirect water use for electricity
Electricity generation can also consume water. LBNL estimated nearly 800 billion liters of indirect water consumption associated with data-center electricity use in 2023. Its estimate applies regional electricity-grid mixes; it does not incorporate facility-specific power-purchase agreements or behind-the-meter generation. That means it should not be read as a precise water footprint for every operator or location.
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The direct and indirect estimates answer different questions and use different assumptions. A community evaluating a project should consider the facility’s actual water plan as well as the electricity supply assumptions relevant to the site, rather than treating either national estimate as a local forecast.
What to check in a local water plan
Ask the project and water utility to identify the source of water, expected annual consumption, peak-day demand, cooling configuration, drought restrictions, and wastewater or discharge arrangements. Compare the proposal with seasonal supply and watershed constraints, not only annual totals. The utility or watershed’s capacity and the timing of demand can matter as much as a facility’s stated yearly use.
Public reporting is also useful: seek commitments to disclose actual use after opening, ideally in a way that lets residents compare operations with the original assumptions. The U.S. Department of Energy Office of Indian Energy lists water use and local community impacts among the considerations for data-center development, alongside transmission, interconnection, and fiber access.
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Construction employment and ongoing facility staffing should be counted separately. Construction can generate a temporary peak in work for trades and contractors; it does not establish how many permanent positions a facility will support after it opens. Supplier, utility, and induced employment may be part of a broader economic-impact estimate, but those jobs are not necessarily onsite jobs or positions held by local residents.
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A useful job claim states the time period and what is being counted: temporary headcount or job-years, full-time-equivalent positions, projected openings or jobs actually filled, wages and benefits, and the share going to local workers. It should also distinguish direct jobs from indirect economic activity and explain how the project’s contribution was determined.
What state reviews show—and do not show
Washington State’s Joint Legislative Audit and Review Committee (JLARC) reported in a preliminary July 2026 review that beneficiaries of a tax preference tied to qualifying urban refurbishment projects reported nearly 300 temporary construction jobs and 53 permanent family-wage jobs. Those are beneficiary-reported figures for the reviewed activity, not a national average. JLARC said it could not establish how much of the activity was caused by the tax preference; the figures alone do not prove net new jobs attributable to the program.
A June 16, 2026 assessment by the Citizens Research Council of Michigan likewise describes construction as the primary source of economic activity and says potential benefits should be assessed case by case. It also notes possible property-tax or community-benefit gains. Neither state-specific assessment supplies a universal estimate of permanent jobs for U.S. data centers.
Who pays for new power and water infrastructure?
The answer depends on the project’s agreements, utility rules, and public decisions. A development may involve new power supply or grid work, water service, roads, and other infrastructure. Whether the developer, utility customers, taxpayers, or some combination pays must be established from the relevant agreements, approved rates, and public records—not inferred from the fact that a project is being built.
The U.S. Department of Energy Office of Indian Energy says: “Partnering with a data center developer holds tremendous opportunity right now—from land leases, to selling power to the data center through a power purchase agreement, to infrastructure development and job expansion.” The same guidance identifies water use, local and community impacts, transmission infrastructure, interconnection, and fiber access as matters to consider. Potential opportunities and impacts both require project-specific terms; a list of possible benefits is not evidence that a particular community will receive them.
How to assess a data-center proposal in your community
Use comparable assumptions when evaluating two sites or proposed projects. A smaller annual electricity estimate, for example, may not tell the whole story if peak demand, cooling, or grid upgrades differ. Ask for documents that connect forecasts to enforceable commitments and show how actual performance will be reported.
Electric system and cost allocation
- What are the forecast annual electricity use and peak load, and what existing grid capacity is available?
- Are new generation, transmission, substation, or distribution upgrades required? What is the expected schedule and who pays under the approved tariff or contract?
- What happens if construction is delayed, the facility uses less electricity than forecast, or the project is cancelled after infrastructure work begins?
- Does the proposal include onsite generation, storage, flexible demand, or a plan to match electricity use with carbon-free supply? What is committed and what is only under consideration?
Water and wastewater
- What is the water source, and what are projected annual consumption and peak-day demand under the proposed cooling design?
- How do seasonal supply, drought rules, and watershed conditions affect availability?
- Where will wastewater go, what discharge arrangements apply, and what public reporting will continue after the facility opens?
Jobs and public return
- How many construction jobs are expected, for how long, and are figures headcount or job-years?
- How many permanent positions are projected, how many have been filled, and what wages, benefits, and local-hiring commitments apply?
- Are reported jobs onsite, supplied by contractors, or estimated indirectly? What evidence supports attribution to the project or an incentive?
- What are the expected property-tax effects, incentive value, and costs for utility service, roads, or other public infrastructure?
- Are community benefits enforceable, and is there a public schedule for reporting whether commitments are met?
Scale, flexibility, and comparisons
Compare facility size, expected workload, cooling approach, and ability to shift or reduce electricity demand. LBNL describes work on grid planning, cost allocation, and flexibility, including controls, workload management, and storage demonstrations. For a particular proposal, distinguish demonstrated capabilities and contractual requirements from options that are merely possible. Compare projects using the same operating assumptions and time periods, then examine how each distributes costs, water demands, employment, and public returns.
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The national estimates establish that data-center electricity demand is substantial and that direct and electricity-related water consumption are different measures. The 2030 electricity figures are scenarios rather than certainties, while the 2023 electricity and water totals are historical national estimates. They do not establish one national household-bill effect, a site-specific water impact, or net job creation for all U.S. projects.
Those local outcomes depend on evidence such as utility tariffs and filings, grid-upgrade plans, project agreements, water sources and operating plans, labor reporting, and incentive terms. A national average cannot substitute for those records when deciding what a project will mean for a particular community.
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