California’s approach to data center growth is under renewed scrutiny as new research highlights how smarter permitting, strategic siting and reduced reliance on diesel generators could curb mounting environmental and public health impacts.
A joint report released this week by the University of California at Riverside and policy group Next 10 outlines a path for states to balance booming digital infrastructure demands with climate and community priorities — and warns that even a state as environmentally forward as California is experiencing significant stress from rapid data center expansion.
“California can continue to demonstrate that economic growth in the digital sector can be compatible with ambitious climate action and community well-being, setting a model for other states and regions to follow,” the report states.
Even though the state derives roughly two-thirds of its electricity from clean energy sources, the report finds that data center consumption is rising far faster than the grid can absorb without added strain. Between 2019 and 2023, electricity use by California data centers jumped 95%, and researchers project demand could surge as much as 356% by 2028. That would mean the equivalent of 2.4 million households worth of annual electricity consumption.
Carbon emissions are climbing in parallel. Data center-related emissions nearly doubled from 1.24 million tons in 2019 to 2.38 million tons in 2023, with projections hitting as high as 5.56 million tons by 2028. The pressures extend to water, with consumption expected to rise to 116 billion liters annually, a concerning figure for a state long challenged by drought.
“Volumes of fresh water for cooling and electricity generation … could rise to 116 billion liters annually — a concern in a state that regularly faces drought and water shortages,” said Shaolei Ren, associate professor in UCR’s Bourns College of Engineering and a co-author of the report.
Nearly 90% of California’s data centers rely on diesel generators for backup power. Although intended for emergencies, they are run frequently for required testing or during periods of peak load. As a result, they emit particulate matter and nitrogen oxides — pollutants tied to respiratory illness and higher healthcare costs.
From 2019 to 2023, the report says, healthcare costs associated with data center emissions tripled, rising from $45 billion to $155 billion, with projections suggesting a climb to $267 billion by 2028. Even under conservative growth forecasts, the state could see “3,900 asthma symptom cases and 490 lost workdays per year” tied to these emissions by 2028.
To address these impacts, the report urges policymakers to give data centers a faster path through permitting if they meet strict standards for energy and water efficiency and are located in areas with abundant clean power and water resources. The approach, researchers argue, allows states to encourage the right kind of development without slowing economic activity.
It also recommends standardizing reporting requirements for energy use, emissions, water consumption and health impacts. “A consistent, high quality comparative base [is needed] to inform targeted policy interventions,” the authors write, noting that patchwork reporting limits the state’s ability to design effective regulations.
The report also emphasizes the need to phase out diesel and adopt cleaner backup technologies, stating that “Cleaner and more sustainable backup options [are available], such as battery energy storage systems, fuel cells, and other advanced alternative fuels.”
Another key recommendation is to expand community science and cross-sector research programs. “Disseminating … findings through accessible reports and structured public workshops would enhance community capacity to evaluate risks and collaborate with researchers and regulators in developing context-specific strategies,” the report says.
California’s long track record in climate leadership positions it to pioneer strategies for responsible digital infrastructure growth, the report concludes. But continued progress will require tighter alignment between state agencies, industry leaders and local communities.
“The path forward necessitates coordinated efforts among policymakers, industry stakeholders, and civil society to ensure that digital infrastructure expansion does not exact an untenable toll on environmental integrity and collective community well-being,” the report says.
As states nationwide evaluate the future of data center development — and grapple with the energy demands of AI, cloud computing and next-generation digital services — observers say California’s policy choices could set a national template.
Originally reported by Robert Freedman in Construction Dive.
