Microsoft announced that the average water usage efficiency, or WUE, of its data centers has improved by approximately 90% since the first generation of these centers was established in the early 2000s. The metric fell from 2.3 liters per kilowatt-hour to 0.27 liters per kilowatt-hour in 2025, alongside continued growth in demand for cloud computing and artificial intelligence services.
The company says that stewardship of water resources has been part of its strategy since the design of its first data centers, and is connected to the Community-First AI Infrastructure initiative and its commitment to become water positive by 2030, meaning that it replenishes more water than it withdraws.
Improved Metrics and Low-Consumption Cooling
Microsoft aims to improve water usage intensity across its entire owned data center fleet by 40% by 2030. By 2025, the company had achieved a 25% reduction compared with the baseline used to measure the target, a level it describes as being more than halfway toward its stated commitment.
Since 2008, Microsoft has used direct air cooling with evaporative assistance as a primary approach across its fleet. This design uses water when the outside temperature exceeds 85 degrees Fahrenheit, or 29.4 degrees Celsius, and can consume up to 90% less water than traditional water-based cooling systems. According to the company, approximately 90% of its owned fleet in 2025 operated with highly efficient cooling systems that use little or no water.
- Traditional cooling towers: Rely on evaporating water to dissipate heat throughout the year.
- Hybrid liquid coolers: Use evaporation in hot weather and switch to dry mode when temperatures fall.
- Direct air cooling: Uses outside air with limited water consumption.
- Air-based chillers: Remove heat from closed-loop cooling circuits without evaporating water.
- Liquid cooling for artificial intelligence data centers: Recycles liquid in a closed loop directly to the chips without evaporating water.
New Designs and Improvements to Existing Centers
In 2024, Microsoft introduced a new data center design optimized for artificial intelligence workloads that consumes zero water for cooling during operation. The design uses direct-to-chip cooling within a closed loop, with temperature control at the zone level.
The company is also improving existing centers by controlling temperature and humidity more precisely, conducting regular audits of water use, and comparing actual consumption with design expectations based on weather data and operational analytics. At its data centers in Phoenix, Arizona, these improvements helped increase water usage efficiency by 23% year over year during fiscal year 2025, and their deployment began in data centers with direct evaporative cooling globally.
Reuse and Partnership with Communities
Microsoft uses recycled, reclaimed, or non-potable water wherever possible. These sources account for 74% in Quincy, Washington; 99% in Singapore; and 79% in San Antonio, Texas. Rainwater harvesting systems are also operating at selected data centers in the Netherlands, Sweden, and Ireland, with plans to install additional systems in other countries and regions. The company expects its new centers in Quebec to collect up to 1.5 million liters of rainwater annually, depending on local precipitation levels.
Microsoft says it fully funds the improvements required in water systems when they are necessary to support its operations, so that communities do not bear the cost. Near its data center in Leesburg, Virginia, the company is funding more than $25 million in water and wastewater improvements. Since 2020, it has invested more than $500 million in over 75 water and wastewater infrastructure projects.
Replenishment and Local Water Projects
During fiscal year 2025, Microsoft said it replenished more water globally than it withdrew, a step toward its 2030 goal. Its projects include a partnership with FIDO Tech and local utilities in the Phoenix area and Nevada to use artificial intelligence to detect and repair leaks in water networks, as well as collaboration with The Nature Conservancy to restore historic wetlands in parts of the Midwest, helping replenish groundwater and reduce flood risks.
The company is also exploring regionally distributed cooling architectures, so that the cooling method matches the needs of different types of hardware and artificial intelligence and traditional computing workloads.