Among the many concerns Americans have about data centers, ranging from the constant background hum to rising electricity prices, excessive water consumption stands out as particularly troubling. Residents of towns that host data centers have reported contaminated water supplies, low water pressure, and unauthorized water extraction, putting one of life’s most essential resources at risk.

Nvidia believes it has found the solution: its new server infrastructure.

The company announced that its newest AI servers will rely entirely on closed-loop liquid cooling, a method that eliminates the need for water-dependent air-cooling fans.

Instead, heat is dissipated through a coolant made of water and propylene glycol that recirculates in a closed loop. Because the system reuses the same fluid, it does not need to draw in any additional water from outside.

“We have eliminated massive amounts of energy consumption and pretty much all water usage,” said Ali Heydari, Nvidia’s director of data center cooling and infrastructure.

On top of that, the coolant can remain operational at temperatures as high as 45 degrees Celsius, which is significantly higher than what previous systems were capable of handling.

The push toward a more energy-efficient design comes at a critical moment. The United Nations predicted earlier this month that AI-related water consumption could equal the annual water needs of 1.3 billion people by the end of the decade.

Nvidia Is Not Alone in Seeking Alternative Cooling

Nvidia is not the only company working toward significantly cutting water use. In August 2024, Microsoft announced that its new data centers would stop using water for cooling, saving more than 125 million liters of water per year per facility.

Andrew A. Chien, a professor of computer science at the University of Chicago, welcomed the announcement. “The thing that’s exciting about what Nvidia announced is it shows really what’s possible in terms of pushing up this liquid input temperature to 45°C,” he told Fortune. “It’s super important to push it up, because in many cases it allows you to do that cooling, that exhausting of heat to the outside environment without running HVAC units, without running air conditioners. Because if it’s cool enough outside, you don’t need to.”

Chien directs the CERES Center for Unstoppable Computing, which has spent the past 10 years studying how to make data centers more efficient and reduce their negative environmental impact. A higher cooling temperature runs counter to conventional wisdom, he explained. The industry standard sits at 30°C, which requires far more air conditioning to maintain.

“The reason they want to do this is that if you can cool the chips at a higher temperature, it becomes easier to vent that heat into the outside environment,” Chien said.

While he noted that achieving truly zero water use is not realistic, liquid cooling will dramatically reduce the demand for water. The main drawback, however, is cost. These systems do not come cheap.

The company estimates that a 50-megawatt hyperscale facility could save more than $4 million a year in cooling-related energy and water costs by switching to liquid-cooled infrastructure.

“It is a direction that more people should be trying to get to, because it’ll reduce the total power consumption of these large data centers,” Chien said.