Indiana Grapples with Data Center Boom's Impact on Electricity and Water

Gov. Braun says tech giants must protect Hoosiers from rate hikes and shortages

Apr. 3, 2026 at 7:18am

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A highly detailed, glowing 3D macro illustration of a data center's cooling towers and server racks, illuminated by neon cyan and magenta lights, conceptually representing the scale and environmental impact of modern data infrastructure.Indiana's rapidly expanding data centers raise concerns over their voracious energy and water demands, underscoring the need for sustainable solutions.Hobart Today

Indiana is experiencing a rapid growth in data centers, with over 70 currently operating and dozens more proposed. However, this surge is raising concerns among farmers and rural communities about the impact on electricity costs and water supplies. Governor Mike Braun is calling for data center companies to pay for necessary power grid upgrades and ensure water recycling to mitigate these issues.

Why it matters

The data center boom is a significant economic opportunity for Indiana, but it also poses risks to the state's natural resources and existing communities. Balancing the benefits and costs will be crucial as the state decides how to manage this growth.

The details

Indiana currently has over 70 data centers in operation, with dozens more being proposed. These facilities use massive amounts of electricity and water to power and cool their computer hardware. This has raised concerns among farmers and rural residents about potential spikes in electricity rates and water shortages that could impact their livelihoods.

  • Indiana is currently experiencing a data center boom.
  • Last October, Amazon opened an $11 billion AI data center near New Carlisle.
  • Amazon is now planning to build a $15 billion data center in Hobart.

The players

Mike Braun

The governor of Indiana, who is calling for data center companies to pay for necessary power grid upgrades and ensure water recycling to mitigate the impact on electricity costs and water supplies.

Amazon

A major tech company that has opened an $11 billion AI data center in Indiana and is planning a $15 billion data center in the state.

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What they’re saying

“It's a real issue, but it can be a big economic benefit if we get it right.”

— Mike Braun, Governor of Indiana

“Data centers are only going to work if the hyperscalers pay for every penny of it. The companies that want them are the richest in the country. Whether they're in front of the meter or behind it, [their electrical usage] cannot impact current families and businesses.”

— Mike Braun, Governor of Indiana

“That eliminated probably a bigger issue—that we don't have water evenly across the state. We're a state that's blessed with more of it than most other places. But, we really don't have much to spare. Over time, water is going to be recycled, [so it's] not a constant stream of using it to cool things.”

— Mike Braun, Governor of Indiana

What’s next

Governor Braun said the decision to allow further data centers to be built should ultimately be left to the individual counties to determine what makes the most sense for their communities.

The takeaway

Indiana's data center boom presents both economic opportunities and environmental challenges. Striking the right balance will require data center companies to invest in power grid and water infrastructure upgrades to protect existing residents and businesses.