The AI boom is growing at an unprecedented rate, with the market for AI technologies expected to surge from $200 billion in 2023 to more than $1.8 trillion by 2030. In the process, this rise of AI will transform industries and revolutionize business operations. However, this step-change growth comes with a paradox for business and sustainability leaders.

While AI offers exciting opportunities for innovation and efficiency, the resources and infrastructure required to power its growth raise complex challenges. The data centers that underpin AI technologies are projected to consume 8% of global energy by 2027. Additionally, these data centers are expected to use more than 1 trillion gallons of fresh water annually for cooling. This dual demand for water and energy is creating pressing sustainability challenges for businesses and communities worldwide—exacerbating the global power grid and water crisis.

To address these challenges and those of other industries, we must rethink our approach to water management. Driving circular water strategies can deliver resilient and profitable growth for businesses. What’s more, circular water solutions aimed at creating a sustainable water cycle by reusing water are available today. This approach focuses on minimizing water waste, improving water efficiency and ensuring that water resources are managed in a way that supports long-term environmental health for communities and business. By embracing corporate water stewardship, we can turn these challenges into profitable opportunities.

Leading organizations are already leveraging AI to drive water use efficiency. For example, Ecolab is working with Digital Realty to implement an AI-driven water solution that will reduce water use in its data centers by 15%, avoiding the withdrawal of 126 million gallons of water from local watersheds annually.

Beyond data centers, understanding the water-energy nexus is critical for sustainable AI adoption. The additional power generation required to meet AI's energy needs also demands significant water resources. However, through smart water strategies, producing more power while using less water is possible. To give one example, Ecolab's powering-reliable-and-clean-energy-with-exelon-generation has helped save more than 1.5 billion gallons of water in one year alone.

Innovative investment opportunities are essential for building water resilience in companies, especially through collaboration in water-stressed regions. Public-private partnerships and innovative financing mechanisms are crucial to bridging funding gaps and driving measurable impact.

A prime example is the California Water Resilience Initiative, a private sector-led effort to accelerate collective action among private, public and non-profit sectors. This initiative aims to reduce, reuse and restore 1 million acre-feet of water by 2030 and 1.8 million acre-feet by 2040. Such partnerships are vital for creating a water-resilient future.

To achieve Sustainable Development Goal 6—clean water and sanitation for all—investments in water infrastructure must quadruple by 2030. In 2024, Ecolab joined Microsoft, Starbucks and others to announce a $100 million investment in WaterEquity's Climate & Water Resilience Fund. This fund aims to develop climate-resilient infrastructure in critical regions, helping provide safe water and sanitation access to 15 million people across Africa, Asia and Latin America. This example of innovative finance demonstrates the potential of leveraging corporate capital to accelerate progress on achieving climate- and WASH-related goals.

As the demand for energy increases, so does the demand for water. This is particularly true for energy-intensive technologies like AI and data centers, which require both substantial power and water for cooling. While the water and climate crises pose significant challenges, 2025 presents a critical window of opportunity to embrace water as a driver of sustainable growth. We have the solutions available today to make a positive impact. By leveraging next-gen AI water solutions, innovative collective action and best-in-class operations, we can advance a resilient, water-secure and profitable future.