Build closed-loop cooling with no evaporative make-up, and publish the energy penalty it costs

The proposal

Charge the cooling loop once at commissioning and reject heat through dry coolers or chillers rather than by evaporating water. Combined with direct-to-chip liquid cooling, this removes the ongoing municipal or groundwater draw for cooling entirely, leaving only small volumes for humidification and domestic use.

Why it would work

Evaporative cooling consumes water as its operating mechanism, not as a side effect. Removing the phase change removes the consumption. Microsoft announced this design in December 2024, claiming avoidance of more than 125 million litres per facility per year, with Phoenix and Mount Pleasant as first sites (Microsoft). Meta states that its gigawatt-class AI design, first operational later in 2026, uses closed-loop liquid cooling with dry coolers (Meta). CyrusOne's eight Chandler facilities already operate with no cooling water at all, using about 180,000 gallons a year for humidification only.

The trade, stated plainly

There is a consistent ladder: evaporative cooling uses less energy and more water; closed-loop direct-to-chip uses less water and more energy; air cooling uses least water and most energy (Latitude Media). Microsoft's own announcement concedes that moving off evaporative cooling increases PUE, mitigated by high-efficiency economising chillers at elevated water temperatures, and calls the result "a nominal increase in our annual energy usage".

Microsoft has never published the number. That is the most consequential unquantified figure in this approach, because the extra electricity carries its own embedded water at the generating station — roughly ten times the direct cooling water in US averages. In a fossil-heavy grid, a facility can go to zero on-site water while increasing its total water footprint. Nobody can currently check.

The requirement attached to this solution is therefore not just the design but the disclosure: publish measured PUE and WUE for the same facility before and after, or for matched facilities in the same climate.

Implementation path

Straightforward at design stage for new builds. The primary decision point is climate: dry coolers size on dry-bulb temperature, so hot climates need larger equipment or mechanical chilling, which is where the energy penalty concentrates. Retrofit of an operating evaporative plant is expensive and rarely done.

Adopt it as a permit condition rather than waiting for voluntary uptake. Chandler, Arizona caps data centre water at 115 gallons per day per 1,000 square feet, and Marana banned municipal potable supply to data centres in December 2024. Those conditions produce the design without prescribing the technology.

Trade-offs and limitations

• Energy penalty, unquantified. A genuine trade, not a free win.
• It can make noise worse. Mechanical cooling means more fan and chiller plant. Microsoft's Mount Pleasant zero-water site generated tonal hum complaints requiring fan adjustment and added acoustic components, so the water fix and the noise fix have to be designed together.
• A related technology was removed from the market. Two-phase immersion cooling reached a documented 1.02 PUE at a 40 MW site but depended on PFAS fluids; 3M ceased manufacture with final orders in March 2025 after a $12.5 billion settlement with more than 11,000 US water systems (The Cooling Report). An environmental fix created a different environmental liability.
• Facility-level zero is not fleet-level reduction. Microsoft's per-facility claim coexists with a forecast global increase to roughly 18 billion litres a year, revised down from 28 billion (The Register). Building more facilities that each use no water still increases total draw at the generating stations.