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By: Joanie Abbott, Associate Manager, Sustainability Solutions at Indigo Ag & Leigh Cooper Swisher, Director, Sustainability Solutions at Indigo Ag
As world leaders dive into the AI boom at Davos, resourcing, from energy to water, will be critical
At Davos this year, leaders from business and government have put forth their visions for prosperity within planetary boundaries. This theme reflects a growing recognition that the next phase of economic growth is colliding with physical limits that markets and boardrooms have not fully priced in.
Nowhere is this tension more apparent than in the rapid expansion of AI infrastructure. Data centers are resource‑intensive. While the digital infrastructure industry has pursued genuine efficiency by shifting towards higher-quality clean power procurement and closed-loop cooling, these site-level gains have been overwhelmed by the brute velocity of expansion. The sector’s total greenhouse gas emissions are on the rise. Data center emissions could reach 829 million tons a year by 2030, an amount akin to the global iron and steel industry.
Similarly, water efficiency improvements have lowered the industry’s per-unit intensity, only to be outpaced by a total volume that demands more from local watersheds than ever before. By 2028, US hyperscale facilities are projected to consume up to 33 billion gallons of water annually. And this intensive water demand cannot be met by distant reserves. Data centers rely on local water availability for their cooling systems, often drawing from aquifers that are already under stress. In water-scarce regions, this can place data centers in competition with existing agricultural and community water use, inflating land prices and disrupting rural communities. While some operators have attempted to sidestep this conflict by drilling deep to access brackish water, ostensibly avoiding municipal water supplies, this is a stopgap, not a solution. As the hydrological baseline shrinks, even these marginal water sources will eventually face competing demands, proving that there is no engineering workaround for absolute scarcity.
Technology companies are facing mounting pressure to enhance data center capacity. As capacity grows, nature-based solutions, like regenerative agriculture, offer an opportunity for companies to compensate for greenhouse gas emissions, replenish water consumption, and in doing so, build trust with local communities where data centers operate. As farmers increase adoption of regenerative practices, they build soil health, sequestering carbon, improving soil water holding capacity, reducing runoff, and strengthening resilience to drought and heat stress. Scaling these practices helps to protect the landscapes that data centers, farming communities, and regional economies rely on. Programs that invest in soil health pay dividends for years to come by providing new revenue streams for farmers and enabling long-term profitability that keeps land in the family farm.
Earlier this month, Microsoft announced a landmark investment in Indigo’s regenerative agriculture project, delivering 2.85 million tonnes of carbon removal over the next 12 years. And importantly, the initiative is expected to conserve approximately 185 billion gallons of water across eight million acres of farmland across rural America.1 The investment reflects a more fundamental acknowledgment: soil health is no longer a peripheral environmental concern, but a critical resource for any industry that uses water, energy, fiber, or food.
Consumer brands, such as Walmart and Kellanova, are coming together to co-invest in regenerative agriculture that safeguards shared commodity supply and reduces disruption. Companies are increasingly viewing these investments as a means to manage environmental risk and support the local communities they rely on, while also meeting broader climate commitments.
The lesson for Davos is not that growth must slow, but that it must be redesigned. Across sectors, leaders are confronting the reality that energy, water, and land are limiting factors for both agricultural yield and data center expansion. Some public and private actors are accordingly mobilizing the capital needed to enable a large-scale transition to regenerative agriculture.
From Microsoft’s 2.85 million soil carbon removal credit deal to the USDA’s $700 million Regenerative Pilot Program last month, the market is validating nature-based solutions. It is up to the leaders at Davos this week to build on that momentum to ensure that the regenerative transition creates economic viability for farmers who steward the land, and by extension, the resources we rely on.
1 Indigo estimates the water benefit from this project will be approximately 185 billion gallons conserved over the 12-year period, with a range of ~90 to 305 billion gallons.
