AI Data Centers Target the Ogallala Aquifer: Water Use and Policy Challenges

Developers are planning AI data centers in Texas and Wyoming on the Ogallala Aquifer: the 11-GW Fermi Matador campus in Amarillo; the 438-acre Texas Critical Data Centers near Odessa; Beacon’s Dove Creek facility near San Angelo; and Related Digital’s $1.2-billion Cheyenne campus in Wyoming. Designs range from air-cooled to liquid-cooling systems.

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The Ogallala Aquifer spans eight states, supplying about 30 % of U.S. groundwater irrigation and one-fifth of agricultural output. Professor Sudeep Pasricha reports depletion rates over 100,000 acre-feet per year and that “nearly 27 percent of stored water already gone in places,” noting the aquifer “recharges extremely slowly.”

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Large AI campuses may consume up to five million gallons per day—“comparable to a town of tens of thousands of people,” says Pasricha. Evaporative cooling can lose 85 % of water; air-cooled designs reduce on-site use. Cheyenne campus uses air-cooled infrastructure, while other projects have not disclosed cooling plans.

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Chief site development officer, Charlie Hamilton, testified before the Texas House Natural Resources Committee on June 24, 2026, emphasizing water-conservation. In Tom Green County, commissioners rejected a 12-month moratorium after a protest of 500 residents and called for stricter regulation of water use. Developers cite tax incentives, cheap land, and transmission access as key site-selection factors.

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Farmers and ranchers ask three questions: projected water consumption, water source, and risk if supplies tighten. The June 2 debate on Beacon’s Dove Creek campus highlighted tension between economic promises and uncertainty. Researchers warn cumulative development could cause “material cumulative effects,” risking irrigation loss, shifts in U.S. crop production, and long-term depletion of a non-replenishable aquifer.

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Beacon Dove Creek and Prometheus’ Casper campus have not disclosed cooling designs or water plans, limiting impact assessments. Water-use estimates vary from 17 billion gallons in 2023 to over 163 billion gallons, highlighting a lack of standardized reporting.

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• “in some subregions, water losses have been sustained for decades, with depletion rates reaching over 100,000 acre-feet per year and nearly 27 percent of stored water already gone in places.” — Sudeep Pasricha, Professor, Colorado State University

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• “large facilities can use up to five million gallons per day, comparable to a town of tens of thousands of people.” — Sudeep Pasricha

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• “Data center site selection depends on a combination of many factors, including the availability of energy, water, land, networking, tax incentives, etc.,” — Benjamin Lee, Professor, University of Pennsylvania

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• “Placing data centers in semi-arid regions with a declining fossil aquifer is a high-risk decision,” — Sudeep Pasricha

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Texas and Wyoming regulators will review water-use permitting in coming months. Developers face pressure to adopt low-water cooling and disclose water-management plans before construction. The decisions will determine whether AI expansion intensifies stress on the Ogallala Aquifer and agriculture.

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