Water Suppliers Could Benefit from Data Centre Investment
Water Suppliers Could Benefit from Data Centre Investment
Jakarta, CNBC Indonesia - Artificial intelligence (AI) has already become part of everyday life for Indonesians. The e-Conomy SEA 2025 report recorded that 80% of digital users in Indonesia use AI-based services every day, while revenue from AI-based applications rose by 127% within a year, the highest in Southeast Asia.
This has made the growth of the digital economy and AI inseparable from the presence of data centres. Amid this surge in computing demand, a question is being asked more and more often: if data centres require large volumes of water, does Indonesia have enough water without disrupting the needs of its people?
The answer is not as simple as whether there is a lot or a little water. Rather, it depends on how that water is allocated, treated and distributed. Even for water service providers, the challenge does not always lie in the availability of water sources.
Riana Afriadi, President Director of the regional water utility Perumda Air Minum Gapura Tirta Rahayu, said that however large Indonesia’s water resource potential may be, without adequate infrastructure, the ability to treat and distribute water will remain limited.
“Indonesia needs to ensure that water requirements for such infrastructure can be met without reducing public access, while also being managed efficiently and sustainably,” Riana said in an official statement on Thursday (8/10/2026).
Water Sources and Allocation
If data centres need water, does that automatically reduce supply to the public? Riana said this is not always the case. The impact depends heavily on where the water comes from, how allocations are set, the treatment capacity, and how the water is distributed.
Riana stressed that the presence of large industrial customers actually opens opportunities to strengthen clean water services.
“We do not see the presence of data centres merely as an additional water need. We see it as an opportunity,” she said.
For water utilities, industrial customers can become an additional source of revenue. This income can ultimately be used to renew infrastructure, increase production capacity, strengthen pipe networks and expand service coverage to the public. In other words, industrial water consumption need not always be viewed purely as an additional burden, but can also become part of developing the water supply system if managed properly.
Equally important, industrial water needs do not always come from the same allocation as household demand. Each region has different conditions regarding raw water sources, treatment capacity, distribution networks and usage allocation. Therefore, the presence of a data centre does not automatically mean it takes water from the channels used by the public.
In Purwakarta, for example, the local government explained that there is an allocation of raw water for the drinking water supply system whose capacity has not been fully used. Part of that capacity could be allocated to industrial needs, while public needs remain the priority. This example shows that what matters is not only how much water a data centre uses, but also whether the water comes from available capacity and how its use is managed.
Beyond water sources and allocation, cooling technology also determines how much water a data centre needs. Cooling towers and evaporative cooling systems use some water to release heat through evaporation. However, technological developments have introduced more water-efficient options, ranging from air-cooled chillers and economisers to closed-loop systems and dry cooling.
Consequently, discussing the water needs of data centres cannot rely solely on consumption figures. Cooling technology, water sources, allocation, treatment capacity, water recycling and seasonal conditions at the construction site must all be taken into account. This approach allows digital infrastructure to grow without sacrificing the basic needs of the public.
Building Sustainable Digital Infrastructure
Accordingly, the development of data centres needs to be built on clear governance, with regulation as the foundation and compliance as a precondition. Water requirements must be tailored to the conditions of each region, including the availability of water sources, infrastructure capacity, public needs, seasonal conditions and the cooling technology used. With a approach based on regional carrying capacity, the growth of AI infrastructure can proceed alongside efforts to safeguard water security.
At the same time, Indonesia has the opportunity to develop a combination of digital infrastructure, energy and water resources. Satya Yudha, a member of the National Energy Council, said the availability of water and renewable energy could become part of Indonesia’s advantage in attracting data centre development.
“Indonesia has room to develop a combination of digital infrastructure, renewable energy and water resources,” Satya said.