Season 7, Post 33: Less water than a leisure centre
Earth may be called the ‘blue planet’, but we have a chronic shortage of water. Global water demand is forecast to exceed supply by 40% at the end of this decade (per the World Economic Forum). Beyond growing populations and income levels, AI is often cited as a culprit. Earlier this year we heard how each LLM request uses a quarter of a litre of water in data centre cooling. New research, however, creates a metaphorical splash.
Data centres are not intensive water users is the conclusion from a recent study conducted by the UK Environmental Agency in conjunction with techUK. It found that nearly two-thirds of commercial data centre sites in England consume less than 10,000 cubic metres of water per year. This amount is described as “lower than a typical leisure centre” and similar to the water requirements of a Premier League football club.
Encouraging news then, even if some sceptics have highlighted that the analysis may not capture the full lifecycle of water use, including indirect impacts from energy generation. Step back and the more significant dynamic remains the structural imbalance between water demand and supply.
Luckily, businesses that operate within the water sector are stepping up to the challenge. We met recently with Xylem, a leading player. Chief Executive Matthew Pine laid out his vision for how Xylem has the aspiration to be “the best industrial AI company in the world.” Even if ambitious, the company has developed many pioneering approaches that seek to manage water supply more efficiently. Through a combination of hardware and software solutions, Xylem is already working to provide cooling systems for data centres and microprocessor manufacturers as well as leveraging (AI) technology across its portfolio. More ideas such as these need to keep flowing across the water sector.
3 September 2025
The above does not constitute investment advice and is the sole opinion of the author at the time of publication. Heptagon Capital is an investor in Xylem. The author of this piece has no personal direct investment in the business. Past performance is no guide to future performance and the value of investments and income from them can fall as well as rise.
Click here to view all Blog posts.
Alex Gunz, Fund Manager
Disclaimers
The document is provided for information purposes only and does not constitute investment advice or any recommendation to buy, or sell or otherwise transact in any investments. The document is not intended to be construed as investment research. The contents of this document are based upon sources of information which Heptagon Capital LLP believes to be reliable. However, except to the extent required by applicable law or regulations, no guarantee, warranty or representation (express or implied) is given as to the accuracy or completeness of this document or its contents and, Heptagon Capital LLP, its affiliate companies and its members, officers, employees, agents and advisors do not accept any liability or responsibility in respect of the information or any views expressed herein. Opinions expressed whether in general or in both on the performance of individual investments and in a wider economic context represent the views of the contributor at the time of preparation. Where this document provides forward-looking statements which are based on relevant reports, current opinions, expectations and projections, actual results could differ materially from those anticipated in such statements. All opinions and estimates included in the document are subject to change without notice and Heptagon Capital LLP is under no obligation to update or revise information contained in the document. Furthermore, Heptagon Capital LLP disclaims any liability for any loss, damage, costs or expenses (including direct, indirect, special and consequential) howsoever arising which any person may suffer or incur as a result of viewing or utilising any information included in this document.
The document is protected by copyright. The use of any trademarks and logos displayed in the document without Heptagon Capital LLP’s prior written consent is strictly prohibited. Information in the document must not be published or redistributed without Heptagon Capital LLP’s prior written consent.
Heptagon Capital LLP, 63 Brook Street, Mayfair, London W1K 4HS
tel +44 20 7070 1800
email [email protected]
Partnership No: OC307355 Registered in England and Wales Authorised & Regulated by the Financial Conduct Authority
Heptagon Capital Limited is licenced to conduct investment services by the Malta Financial Services Authority.
