Data centers are not a new technology, but the growing need for this infrastructure has led to equally growing confusion. This blog aims to shed light on common misconceptions and provide the facts.
Myth: Data Centers Use Excessive Amounts of Water
Water consumption is often raised as an environmental consideration associated with data centers. The equipment in these facilities generates considerable heat, making effective cooling systems essential for maintaining reliable operations. Historically, some data centers have relied heavily on traditional water-based cooling, but advances in technology allow newer facilities to operate with significantly less water. For example, closed-loop cooling systems can reduce ongoing water use by continuously circulating and reusing water within the system. Rather than traditional cooling systems such as evaporative cooling, modern technologies allow the same water to be recirculated throughout the facility, making the data center much less water-intensive. The City of Cheyenne Board of Public Utilities reported that data centers represent approximately 1.9% of the city’s overall water consumption.
Myth: Data Centers Consistently Release Harmful Wastewater
Wastewater management is another commonly voiced environmental issue associated with data center operations. Because cooling processes can introduce various substances into wastewater, communities may have questions about how that water is handled before it is returned to the environment. To reduce pressure on local freshwater supplies, some data centers are incorporating reclaimed water into their cooling systems rather than relying entirely on potable water. Facilities may also use treatment technologies on-site to process wastewater and help meet the required water quality standards before it is released. Wyoming data centers must comply with state and local environmental regulations, just like many other common commercial operations such as trucking and deliveries, highway use, heavy machinery and construction, and local transit and buses. Those regulations address the storage of fuel and other materials, the use and handling of chemicals associated with cooling equipment, wastewater management and protections for groundwater and nearby resources.
Myth: Data Centers Increase Utility Costs
Another common misconception with data centers is that they raise utility costs for members of the community. A 2026 study by Energy and Environmental Economics (E3) indicates that data centers have not historically caused residential electricity rate hikes. Moreover, an analysis of four Amazon data center locations showed that each facility contributed an average of $3.4 million in net surplus revenue, with utility payments covering more than the costs required to service them.
Additionally, Wyoming regulates large electrical loads, such as data centers, through specialized tariffs and negotiated agreements overseen by the Wyoming Public Service Commission (WPSC). This “large load tariff” is a specialized electricity pricing and regulatory agreement in the state of Wyoming. It isolates massive energy users like data centers from the general public, and ensures that these high demand entities pay for their own power infrastructure upgrades, market purchases and generation capacity. This protects everyday residential and small business ratepayers from sudden utility rate hikes.
Sources: https://www.ethree.com/wp-content/uploads/2026/05/Understanding-the-Drivers-of-Rising-Electricity-Rates-and-the-Role-of-Data-Centers_E3-2026.pdf , https://wyoleg.gov/InterimCommittee/2026/07-202605216-01WY_Cooperative_Large_Load_SolutionsRev5.pdf
info@wyomingdriveninnovation.com
Copyright © 2026 Wyoming Driven Innovation - All Rights Reserved.
We use cookies to analyze website traffic and optimize your website experience. By accepting our use of cookies, your data will be aggregated with all other user data.