England’s already strained water supply could be under far greater threat than official forecasts suggest, as the country’s environmental regulator admits it has no reliable data on how much water is being consumed by the booming artificial intelligence sector.
The Environment Agency (EA) has warned that by 2055, the public water supply in England could face a shortfall of 5 billion litres per day, with an additional 1 billion litres per day needed for industry, agriculture, and emerging technologies. However, that estimate does not include the water used by AI datacentres, which are expanding rapidly and consuming vast amounts of water for cooling, much of it drawn from the public supply.
EA sources told The Guardian that the exclusion of datacentre water usage from its projections makes it impossible to quantify the true future water deficit. Every five years, the agency publishes its national projections for water use, but insiders say this year’s modelling was particularly difficult because of the unpredictable and explosive growth in AI infrastructure, which represents a sharp shift in industrial demand patterns.
The issue is compounded by a lack of mandatory reporting. At present, datacentre operators are not required to disclose how much water they consume, leaving regulators effectively blind to one of the most critical trends shaping England’s future water demand.
AI datacentres, which require significant energy and water resources to operate, rely heavily on cooling systems to prevent servers from overheating. These include cooling towers and evaporative systems, both of which consume large volumes of clean, treated water. Industry estimates suggest AI datacentres use between 1.8 and 12 litres of water per kilowatt hour of energy consumed—figures that, when scaled up across multiple centres, become startling.
A recent study projected that global AI operations could consume up to 6.6 billion cubic metres of water annually by 2027—equivalent to two-thirds of England’s current total annual water consumption.
Alan Lovell, Chair of the Environment Agency, issued a stark warning: “The nation’s water resources are under huge and steadily increasing pressure. This deficit threatens not only the water from your tap but also economic growth and food production.”
He added: “Taking water unsustainably from the environment will have a disastrous impact on our rivers and wildlife. We need to tackle these challenges head-on and strengthen coordinated action to preserve this precious resource and our current way of life.”
The challenge is further complicated by government policy, which is increasingly focused on making the UK a global leader in AI. Prime Minister Keir Starmer has already pledged to expand AI infrastructure, including cutting planning restrictions for datacentres in designated “growth zones”. These zones could see datacentre construction fast-tracked—often without corresponding scrutiny of their environmental impact.
Despite the projected pressures, many AI datacentres continue to use public water supplies rather than seeking private or recycled sources, something the Environment Agency has said it does not wish to discourage, but which raises serious concerns about long-term sustainability and transparency.
Water companies have submitted long-term infrastructure plans to address the growing shortfall, including proposals for nine desalination plants, 10 new reservoirs, and seven water recycling schemes to be completed by 2050. However, critics point out that these projects are expensive, time-consuming, and may not be ready in time to offset rising demand—especially from sectors like AI, which are growing at exponential speed.
The cost of this investment is already being passed on to consumers, with household water bills rising across England to fund the infrastructure upgrades. Meanwhile, the government is planning a nationwide rollout of smart meters to track and charge households based on individual water usage.
Climate change will likely exacerbate the crisis. With hotter, drier summers projected in coming decades, areas reliant on surface water sources will become more vulnerable to drought conditions. Groundwater reserves may also struggle to recharge consistently, further reducing availability.
Some proposals have already attracted fierce public opposition. On Tuesday, Thames Water launched a statutory public consultation on a controversial £300 million drought resilience scheme that would see 75 million litres of treated sewage pumped into the River Thames every day during drought conditions. The plan, centred on the Mogden treatment works in south-west London, aims to maintain river flow by substituting treated effluent for clean extraction.
Critics—including Liberal Democrat MP Munira Wilson—have raised alarm over the risks to water quality, chemical contamination, and the broader ecological impact of introducing treated sewage into the river. The Environment Agency itself has warned that Thames Water has failed to demonstrate the environmental feasibility of the scheme.
This comes as Thames Water continues to leak an estimated 570 million litres of water a day—the highest volume of losses among any UK water company.
The revelations about unaccounted-for datacentre usage are likely to intensify scrutiny of both regulators and policymakers. Without mandatory reporting requirements, the Environment Agency’s future modelling will remain incomplete, limiting the government’s ability to plan effectively for a secure water future.
David Black, Chief Executive of Ofwat, the water industry regulator, urged the sector to move forward with investment. “Boosting supply through building critical water infrastructure is essential to safeguard supplies of drinking water,” he said. “The way is now clear for the industry to build on the success of the Thames Tideway project by delivering the 30 major infrastructure projects we need in England and Wales.”
Yet with rising industrial demand, accelerating climate impacts, and no comprehensive oversight of one of the most water-intensive technologies on the horizon, experts say that even the most ambitious plans could fall short unless systemic reforms are introduced—starting with mandatory water reporting by AI datacentres.
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AI boom means regulator cannot predict future water shortages in England