Huge AI data center project blindsides water-stressed town in Brazil

A company called Atlas Renewable Energy, an arm of the global asset manager BlackRock, is planning a 1-gigawatt data center in Paracatu, Brazil, a project larger than every data center currently operating in the country combined. Local officials, business owners, farmers and residents told reporters they learned about it only when journalists called to ask questions, including the city council president and a former mayor who called the region's claimed water abundance ‘controversial’ given long-running water conflicts there.

Paracatu sits in the Cerrado biome, a savannah that functions as a natural water reservoir for the country, and residents describe wells, streams and swimming holes that have already dried up or been paved over. Data centers require enormous water volumes for cooling, and Brazil has no national environmental regulation specific to them, even as Mongabay and Intercept Brasil identified at least 68 such projects planned across 37 municipalities.

Atlas told reporters the project is in a ‘very preliminary study phase’ with no technical decisions made, despite having already submitted a grid-connection presentation to Brazil's Energy Ministry laying out a three-module buildout with partial operations by December 2027. Brazilian President Lula has meanwhile pitched the country's water and energy abundance to foreign investors, including ahead of a meeting with President Trump, whose administration backs the broader Stargate AI infrastructure push this project resembles in scale.

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