Two major data center projects were proposed in the San Marcos area. One by Armbrust & Brown, PLLC, on behalf of Highlander SM One LLC and Donald and Germaine Tuff, and the other by CloudBurst Data Centers. The projects currently vary in their level of development.
The proposed data centers in San Marcos threaten the region’s stability by straining limited water resources and increasing energy usage, costs that far exceed short-term economic gains.
A data center is a facility that houses computer systems and associated components, according to IBM. The centers are used to store, process and distribute large amounts of digital information. Data centers require constant power, cooling and vast computational power to handle complex workloads associated with artificial intelligence.
“AI computing requires a huge amount of data center capacity, and those data centers need far more than just energy. They involve carbon emissions, water usage, electronic waste and intensive hardware,” Heena Rathore, assistant professor of computer science, said.
As the demand for artificial intelligence increases, so does the resource demand and environmental footprint.
“Even a single query demands serious computational power. Multiply that by millions every second, and the environmental impact becomes significant. That’s why there’s so much debate, especially here in San Marcos,” Rathore said.
This increased demand raises significant concerns, particularly in water usage. Large-scale data centers average approximately 550,000 gallons per day, equal to about 4,200 people’s typical daily water usage. With a population of 71,569 residents, a single large-scale data center would account for nearly 12.5% of San Marcos’ daily water intake, according to Executive Director of The Meadows Center for Water and the Environment at Texas State University, Robert Mace. In a city where water shortages are projected by 2047, water usage must be consciously considered.
“People don’t realize the amount of water these facilities can use for cooling,” Rathore said. “In Texas, with our climate and water issues, that’s a serious concern.”
The Highlander developers have proposed using water supplied by the San Marcos River and Carrizo-Wilcox Aquifer, with Crystal Clear Special Utility District approving water usage equal to that of a single-family residence. The company has also indicated it will use a closed-loop system, where water is recycled throughout the facility, to minimize water consumption. However, the developers have not indicated whether this low water usage would go beyond the initial phase of development.
Additionally, closed-loop systems are not perfect and require water lost by evaporation and leakages to be replenished. Cloudburst has yet to disclose where it plans to source its water. This uncertainty is amplified by the ongoing drought of San Marcos and the broader Hill Country.
Energy usage is another point of concern, with AI data centers requiring high energy consumption.
CloudBurst’s proposal is perhaps the most concerning, with the company announcing plans to power its AI data center with a 1.2 gigawatt (GW) natural-gas plant, supplied by a 10-year contract with Energy Transfer’s Oasis Pipeline. 1.2 GW is enough to power one million homes, and more than the energy demands of the entire Austin metro area in a single day.
The facility would burn natural gas constantly, releasing harmful pollutants into the atmosphere. These pollutants contribute to the formation of smog, the development of acid rain and significantly increase the risk of respiratory and cardiovascular illnesses in the local community.
While these data centers have the potential to bring jobs and technological investment to San Marcos, the current proposals raise serious concerns. Tech companies like Google and Microsoft have made strides, Google’s data centers are now 1.8 times more energy efficient, and Microsoft reported 90% server recyclability in 2024. However, the proposed centers are currently far behind this standard.
With the right safeguards, oversight, and sustainability commitments, these facilities could bring meaningful economic and technological benefits. But the current proposals fall short, ignoring local stakeholders and overlooking serious environmental risks.
“I am not against data centers,” Rathore said. “But it has to be responsible growth. The companies need to be transparent and accountable to the people who will live with the consequences.”
-Andrew Bencivengo is a business administration sophomore
