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I think the issue is the volume of water needed to cool these systems during peak hours. Even if the water is reclaimed, allocating all that water for availability by the data centers distorts availability for everyone else in the region.

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Exactly this. This is a major issue in my region right now, central Texas. Data centers are going up in some of the most drought stricken areas of Texas, and since it is hot and dry, they want to save money on cooling by misting. This uses precious fresh water that would have gone to support the overwhelming growth of local cities. So now everyone who lives in the area is paying more for water service because the cities are competing for water with the data centers. Guess who has more lawyers and money?

I still don't understand why more attention is not being paid to oil immersion cooling! https://par.nsf.gov/servlets/purl/10101126

It's corporate greed and an unwillingness to face the external consequences of demand for compute. Just because misting is cheaper doesn't make it automatically better.

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