Every person and industry uses water. Yet water – a shared, common-pool resource – is often an afterthought in site selection and planning. Industries are important stakeholders in the groundwater-governance conversation.
Industrial water users are invested in planning and policy decisions which may impact their ability to scale and grow. Industries with a regional presence and familiarity navigating different governance structures, restrictions, standards, and incentives may still need assistance with the specifics of local groundwater availability. However, water-intensive industries are also driven by financial pressures.
There is potential for conflict with domestic water users and grassroots priorities, especially where legal or social pressure has been used against front-line communities to quiet dissent against water-intensive development. Information transparency can help to mitigate tensions between all water users.
Economic development opportunities
The states in EPA Region 5 are working to attract large water users to the region. Revenue that comes from property tax income and new development projects is an economic driver which incentivizes communities and the state to hear proposals. Water-intensive industries may offer future infrastructure development in the form of roads, investment in the local schools, new jobs in return for tax write-offs, and bulk rate offers on water purchases. Each offer is different depending on the company, internal goals, budgets, and timelines. Many states also offer tax incentives specific to particular industries, like data centers, as described in this report from the Midwest Council of State Governments.
However, the Washington Post reports that data centers can use between 1 and 5 million gallons of water per day. Google’s data centers consume 6 billion gallons of water annually. Data center water use can be equivalent to that of an entire city of 300,000 people. A single ChatGPT query uses at least one 500 ml bottle of water. Are cities and states in the region adequately weighing the benefits and risks of attracting large water users to their region?
Groundwater conditions vary
Some areas in EPA Region 5 have excess water supply, some areas have scarcity issues, and others water-supply alternatives. Infrastructure designers may be unaware of the detailed hydrogeologic setting or how this information might be used early on to help site proposed facilities and reduce permit timelines. This knowledge is typically developed by the state or Tribal government. In some cases, regional planning authorities also created additional context. State and Tribal regulatory agencies may be involved in the siting of new industrial facilities during approval of water appropriation permits or in the review of any required environmental impact statement. However, if a water user applies directly to a municipality and becomes a power and water customer of the city, then state agencies are typically not involved in regulations or approvals. In these instances, industrial water users forgo the benefit of the detailed understanding of state agencies which would have otherwise informed long-term design decisions for the proposed site selection.
What large-volume water users are looking for
Developers balance priorities when siting and designing large industrial facilities including manufacturing, technology, industrial agriculture, or food and beverage facilities. These priorities include cost, schedules, noise, energy availability, and finally, water use.
Key factors that influence selection of a build site are the availability and the dependability of water access and the ease and the timeline of getting permits approved. Industrial users typically prioritize fast approvals to get systems online sooner to maximize revenue. But above all, industries require a dependable water supply to reduce the risks of downtime once operations begin. The need for water efficiency must be balanced against the speed of getting a permit and overall capital and maintenance costs of the alternative.
Many times, groundwater is the default supply due to faster permits and better water quality, followed by surface water, and then water reuse. Yet water needs may not be discussed until late in the planning process. While technology is moving towards low- to no-water-use cooling systems, developments tend to move fast before circular design principles or alternative cooling options can be fully considered. The cost of reusing wastewater is prohibitive in some places. In other regions, water reuse may not be supported by policy. The timelines for planning and permit approvals are commonly long.
Planning, coordination, and policy solutions
Ideally, state agencies would proactively help cities and industries identify locations that would support large water users that local units of government and economic development teams could designate in the planning process. States could compile data on the water supply availability per region across groundwater, surface water, or water reuse sources. States could also create a generic review process for cities to consult when citing large-volume water users and provide more certainty in the permitting process.
Incentives for sustainability, streamlined permitting of circular water design features, and the co-location of industries with complementary inputs and outputs would improve both business expenses and overall resource management. Using sufficient scientific data to support cost-benefit analyses and risk assessments, local planners would be able to work with utility operators to balance local energy and water supply growth with environmental impacts. To build trust, power differentials among individuals must be recognized and acknowledged. All the actors across the different sectors need to understand how past actions may have contributed to present inequities and commit to a shared future in a shared geology and geographic space.
This can be assisted by:
- Coordinating long-term water supply planning on a regional level.
- Encourage local planning teams to talk about sustainable water supply early in the development process with the municipal government and state agencies.
- Define areas where groundwater is vulnerable to depletion or where there is likely to be well interference.
- Encourage proactive identification of sites with sustainable water supply sources in city comprehensive plans.
- Clarifying state agency roles in siting and permitting of water-intensive projects.
- Activating local watershed planning and implementation groups.
- Provide opportunities for citizens to engage and comment on prioritization for groundwater use in their area.
- Encouraging circular water solutions.
- Site large-volume water-use businesses near sustainable water supply sources such as surface water sources or wastewater treatment plants.
- Encourage groundwater infiltration for discharge of industrial water to keep water in the watershed.
- Encourage sustainability rating systems and offer incentives for certification.
- LEED certification for data centers includes criteria to optimize water use.
- Process water use is focused on multiple cooling loops, reducing water use, or using recycled water.
- LEED standards currently do not include source-water sustainability; new incentives for alternate water sources (besides groundwater) could be added.
- LEED certification for data centers includes criteria to optimize water use.
- Enacting legislation to require that:
- Developers consider alternatives to using groundwater, such as geothermal, surface water, or water reuse.
- Environmental review for water-intensive developments be strengthened
- State groundwater data be shared with local decision makers at the city and county level when a new data center is initially proposed.
- A water-use threshold be established that would trigger an industrial water user to apply for a water appropriation permit rather than allowing these projects to be covered by municipal water permits.
- Data centers are located in specific municipal zoning districts.
Note: This information is part of a series of groundwater governance topics Freshwater explored during an 18-month project, which culminated in the report: Towards Collaborative and Equitable Groundwater Governance in EPA Region 5.