On a hot, dry day on Indonesia’s Batam Island, 300 frustrated residents marched into the Nongsa Digital Park compound carrying empty plastic bottles and jerry cans, chanting for one basic necessity: water. For three months, their home taps have run completely dry, while the data centres at the heart of Batam’s plan to become a regional digital hub have had continuous access to water to keep heat-sensitive servers from overheating. The protest is the latest flashpoint in a growing conflict between economic development ambitions and the daily survival of local communities, as global demand for artificial intelligence infrastructure pushes water and energy resources to breaking point.
Dewi Susanti, a protester from the village of Bakau Serip, told the BBC that local water access was consistent and reliable before data centre construction began. Today, residents rely on government water tankers that deliver water she described as dirty, cloudy and foul-smelling. The crisis has already upended household finances: money that once covered staple foods like rice now goes toward storing water, and Dewi’s husband is forced to stay up overnight to queue for limited water deliveries before reporting straight to work the next morning.
Local authorities have offered conflicting explanations for the shortage. BP Batam, the government agency in charge of overseeing trade and industrial development on the island, blames an extended dry season worsened by this year’s historic super El Niño, and denies allegations that residential water supplies have been diverted to feed corporate data centre demand. Batam’s state water utility has acknowledged it is working to improve distribution but declined to comment on whether supply cuts are tied to rising industrial demand from the tech sector.
Batam has no natural large freshwater sources, so its 1.3 million residents depend entirely on rainwater captured in six man-made reservoirs. Local environmental non-profit Akar Bhumi Indonesia ran hydrological simulations that found the Nongsa reservoir – which supplies Bakau Serip and surrounding communities – will run completely dry within a month if no significant rain falls. Even before the current wave of data centre development, Batam faced routine seasonal water shortages; growing demand for digital infrastructure has stretched the island’s limited resources far beyond capacity.
The conflict in Batam is not an isolated incident. As tech firms pour hundreds of billions of dollars into building new AI infrastructure across the globe, communities from the United States and the United Kingdom to Southeast Asia have pushed back against the rapid expansion of data centres. These large, windowless facilities run nonstop, requiring massive amounts of electricity to power servers and equally massive volumes of water to cool equipment and prevent overheating. US research shows a standard data centre consumes roughly 300,000 gallons of water per day – equivalent to the total domestic water use of 1,000 American households. Malaysia’s central bank estimates that a larger 50-megawatt facility can use as much water daily as 2,200 households, while drawing enough electricity to power 22,000 homes.
Experts warn that a lack of transparency around data centre water use makes it harder to address resource conflicts. Agus Hasan, a professor at the Norwegian University of Science and Technology, notes that reliable public data on water consumption by Indonesian data centres remains extremely limited, because most tech firms treat usage figures as proprietary business information. “We should build data centres rationally, transparently, and responsibly, and insist on seeing the numbers,” Hasan said. “Otherwise, those kept in the dark while their taps run dry will push back, and rightly so.”
Batam’s rise as a digital hub is largely driven by spillover demand from neighbouring Singapore, located just a one-hour ferry ride away. Singapore imposed a moratorium on new data centre construction in 2019 due to constraints on land and energy, before lifting the ban in 2022 alongside new strict efficiency standards. The city-state has actively promoted surrounding regions including Batam and Malaysia’s Johor state as complementary hubs for digital infrastructure. Johor quickly approved tens of billions of dollars in data centre projects, but soon faced widespread public backlash over noise, construction dust and growing water scarcity, prompting state officials to impose strict new consumption limits.
Batam has emerged as a top alternative for investors from the US, China, Australia and Singapore thanks to its proximity to Singapore, low operating costs and access to major global subsea internet cables. To date, Indonesian officials have approved 10 data centre projects for Batam, six of which are located in the Nongsa Digital Park. Two facilities are already operational, a third is under construction, and at least six more projects are currently under review for approval. Official data puts total confirmed investment in Batam’s data centre sector at more than $6.7 billion (£5.1 billion) as of mid-2024, with major players including Hong Kong private equity firm Gaw Capital, Indonesian developer Sinar Primera, Singapore’s DayOne, and AI giant Nvidia already committed to projects. By 2030, official projections estimate power demand from Batam’s data centres will exceed 1,100 megawatts – enough to power nearly 1 million average Indonesian households.
Following earlier protests against water diversion in August and September 2024, authorities mandated that all new data centres build their own desalination plants to avoid drawing freshwater from local reservoirs. But local residents remain deeply concerned that they are now forced to compete for limited water resources with corporate AI infrastructure. For communities already struggling with daily water access, the promise of billions in digital investment has done little to ease their hardship.
Marlinda, a resident of Sei Beduk district which is also facing severe water shortages, called on officials to visit affected communities and prioritise local needs over corporate profits. “Don’t just sit at the top and keep approving these projects. Come down here and see for yourselves what we are wrestling with,” she said. “We are not asking for anything extravagant. We just want our water supply restored.”