Water Use and Community Trust: Key Components of Data Centers’ Social License to Operate

Timeline

Status: In-progress

Description

Executive Summary

Data centers are rapidly expanding to support artificial intelligence (AI), cloud computing, and digital infrastructure, bringing increased scrutiny to the physical resources that enable growth. While national-level water use from data centers remains relatively modest, this paper finds that localized impacts, combined with limited transparency, are driving rising community opposition and creating material risks to project development. The findings highlight that community acceptance is shaped less by absolute water volumes and more by perceptions of fairness, transparency, and long-term resource sustainability. As a result, water is emerging as both a physical constraint and a social determinant of where and how data centers can be built. The paper concludes that proactive water stewardship, including improved disclosure and early, meaningful community engagement, is essential not only for environmental performance but also for securing a durable social license to operate, enabling the continued growth of the digital economy.

Team

Members

Megan Van Son Ferryman is a second-year dual Master of Environmental Management and Master of Business Administration candidate at Duke University with concentrations in Energy & Environment and Community Engagement and Environmental Justice. She received a B.B.A in Marketing and Management from the University of Kentucky, where she focused in social entrepreneurship. Prior to coming to Duke, Megan worked in non-profit development, corporate communications, and as the owner of an equestrian technology startup, Blue Horse Entries. In the 2025-2026 school year, Megan served as Co-President of the Nicholas School Energy Club and Co-Chair of the 17th annual Duke University Energy Conference. In her third year of school, she will be serving as Co-President of the MBA Energy Club. Her academic and professional interests focus on the intersection of sustainability, innovation, and mission-critical infrastructure. 

Leaders

Ian Hitchcock