Technology in the Desert: The Debate Over Data Centers and Uruguay's Water Crisis
In July 2023, Uruguay lived through its worst drought in 70 years and also the year its government quietly confirmed that Google would be building its second Latin American data center just outside Montevideo.
The announcement of Google's arrival in Uruguay set off a wave of excitement about economic benefits — and serious alarm about environmental costs. After years of drought and a near-total breakdown of the water supply, a population that lived through the crisis firsthand is asking hard questions. Can technological development actually coexist with protecting something as basic as water?
n July 2023, Argentine journalist Valentina Koifman stopped for a coffee at a classic bar in Montevideo's old city. That night, a local news anchor framed the story under the chyron "Salty Coffee, Undrinkable" — and Koifman explained on camera that she'd had to add salt just to get it down. "It was genuinely awful," she said, adding that she hadn't even bothered salting the water she put on to boil, because it already had so much sodium and chlorine in it that more salt would have made it completely unpalatable.
Her story wasn't an isolated case. Some 355 miles away, in Olivera, Salto, children at a rural school had to go home in March 2022 — weeks before the school year even started — after breaking out in vomiting, diarrhea, stomach pain, and fever. Two teachers, with the support of the local community, collected samples from the town well and from household taps and sent them to a lab run by the Salto municipal government. The results showed the water contained fecal coliform bacteria and other pathogens that made it unsafe to drink. A month later, the drought set in.
The finger-pointing started almost immediately. "People are going to get mad at me, but we all fell asleep on this. Let's share the responsibility. That's how I see it," said former president José Mujica at a press conference. Meanwhile, then-Montevideo mayor Carolina Cosse struck a more measured tone: "This crisis has put on the table how important it is to pay attention to water in every dimension. We're seeing just how little systematic information we actually have."
The years of neglect, short-sightedness, and lack of planning that led to that moment left a mark on all 3.5 million Uruguayans. But they also sparked something: a new kind of collective awareness.
The Start of a Mega-Project
In early November, deep inside the Parque de las Ciencias — a free-trade zone in Canelones and the home district of newly elected president Yamandú Orsi — Uruguay granted the Environmental Pre-Authorization (AAP) for the construction of the region's first large-scale data storage facility. The site covers 82 acres, roughly the size of the Bioparque Temaikèn wildlife park outside Buenos Aires, or Munich's Allianz Arena.
Uruguay is the second country in Latin America to move forward with a project of this scale. Chile got there first, closing a national consultation on its National Data Centers Plan (PDATA) in mid-November — a proposal led by the Ministry of Science that pulled in every government ministry to evaluate whether Chile could become "a benchmark for sustainable and strategic data center development in Latin America," and commit public institutions to building out the necessary infrastructure.
In Uruguay, negotiations started under the Tabaré Vázquez administration, shrouded in confidentiality. It wasn't until late August 2023 that the government of Luis Lacalle Pou officially confirmed the project. By August 2024, the Ministry of Industry, Energy and Mining (MIEM), alongside other national and local agencies, had broken ground in Canelones — an $850 million investment projected to employ between 300 and 400 people.
But the excitement hasn't quieted the concerns. Some sectors fear the kind of "energy shocks" that have already hit Ireland and the Netherlands, where data center demand pushed electrical grids to the breaking point. Environmentalists and advocacy organizations in Uruguay have been vocal about their opposition.
A Data Farm: What Exactly Is a Data Center?
Ever wonder where all those photos, selfies, and files you upload to "the cloud" actually go? The answer isn't some digital ether — it's data centers: physical facilities that work like digital libraries, packed with servers that process and store information. Services like Spotify, Netflix, and WhatsApp all depend on these behind-the-scenes operations to get content to your devices in real time.
To do that, data centers need three things: servers that locate and deliver information, cables and internet infrastructure that move it to your devices, and cooling systems that keep the whole operation from overheating.
This massive storage infrastructure — holding everything from junk data to critical information — can be owned by Google, Amazon, Alibaba Cloud, or Tencent, depending on where you are in the world. And it's distributed across the globe, often in places you'd never expect.
Uruguay has made significant strides in connectivity recently, particularly for users and businesses across South America who rely on Google products. The acquisition of the Firmina submarine cable — stretching 8,400 miles to connect Argentina, Uruguay, and the United States — has made the country a key node in the digital highway that carries services like YouTube, Gmail, and Google Cloud. It's infrastructure that matters more and more to the digital economy.
Our Algorithmic Garbage
But not everything shines in the technological horizon. Writer Yuval Noah Harari has long warned about unchecked technological advancement, unsustainable consumption patterns, and the exploitation of natural resources. Data centers are no exception.
According to a Washington Post investigation, AI tools like ChatGPT can consume up to 17.5 oz of water to generate a single 100-word email — roughly the equivalent of a standard water bottle. Multiply that by millions of users, and the cumulative impact becomes alarming fast.
Google's original proposal for the Uruguay facility required 7.6 million liters of water per day. After public pressure and legal challenges, the project was redesigned around an air-based cooling system, significantly reducing water consumption. But groups like REDES-Friends of the Earth, represented by Raúl Viñas, are still pushing back against what they see as a fundamental lack of transparency in the environmental impact assessments. "These projects don't prioritize the needs of the population — people who are already facing restrictions on access to drinking water," Viñas said.
According to a Uruguay XXI report on renewable energy, between 2018 and 2022, 94% of Uruguay's electricity came from renewable sources — a figure that dropped to 91% in 2022 due to reduced hydroelectric output caused by the drought. "Uruguay needs to be extremely careful about how it manages resources like water, especially after what just happened," said Dr. Andrés Ferragut of Universidad ORT. He also stressed the need for strict regulations to ensure these resources are used responsibly.
A Future Between Technology and Sustainability
Data centers are the backbone of the digital economy, processing the enormous volumes of data generated by AI and the Internet of Things. But the tension between technological development and sustainability isn't going away.
Uruguay faces a real challenge: figuring out how to balance economic progress with the protection of natural resources its people depend on. The question of whether those two things can coexist — or whether one will eventually win at the expense of the other — doesn't have an easy answer.
In the meantime, local communities and environmental organizations aren't letting up. They're keeping the pressure on to make sure these projects don't end up mortgaging the future for the sake of a headline about innovation.
Editor's Note: This article was updated on May 16, 2023.
- “the first data center in the region”
Google's data center in Canelones is the second in Latin America, not the first. Google inaugurated its first regional data center in Quilicura, Chile, in 2015. The one in Uruguay is indeed the first in the country. - “estimated to employ between 300 and 400 people”
The figure of 300 to 400 people corresponds exclusively to the construction phase (with a peak of up to 800 workers). Once operational, the data center will generate approximately 50 permanent jobs. - “the plant in Canelones was inaugurated”
What was inaugurated in August 2024 was the start of construction, not the operational plant. Construction is being carried out in four stages over 26 months. The estimated completion date is between late 2026 and early 2027. - “AI can consume 519 ml of water to generate a 100-word email.”
This data comes from a 2023 study by the University of California, Riverside, on GPT-4 in water-cooled data centers under 2023 conditions. More recent independent analyses place the actual consumption between 5 and 519 ml per query, depending on the methodology and model.
