Balancing Kenya’s AI Growth with Naivasha’s Water Scarcity

Naivasha, Kenya – For residents near Naivasha, water is a vital lifeline supporting households, livestock, agriculture and education.

This issue gained urgency when plans for a large Microsoft‑G42 data centre in Olkaria, close to Lake Naivasha, were put on hold in May 2026 due to doubts about sufficient power supply.

Microsoft and the UAE‑based AI firm G42 unveiled the initiative in 2024 within a $1 billion digital‑investment package for Kenya, envisioning a geothermal‑powered campus that could eventually reach 1 gigawatt.

The delay has raised concerns about how an additional major industrial consumer might affect water availability in an area where locals already experience shortages.

Both firms stated the centre would be powered solely by renewable geothermal energy and would employ water‑saving technologies, though they did not release a specific water‑use estimate in the 2024 announcement.

Frank David Ochieng, communications director at Kenya Electricity Generating Company (KenGen), told Al Jazeera that the project is still in the design phase and declined to elaborate until it moves forward.

Musa Olorkedienye, a local resident interviewed by Al Jazeera, explained that water scarcity is a everyday reality, noting that communities near Olkaria have lost dependable piped water previously supplied by KenGen.

“We now depend on water vendors, our livestock trek long distances for water, and we worry that rising demand will make the situation worse,” he said.

Pastoralist Isaac Leshishi, also speaking with Al Jazeera, added that worsening weather patterns are intensifying the strain on water resources.

Why Olkaria?

Olkaria was selected primarily for its energy potential; the region hosts Kenya’s principal geothermal plants, which make it well suited for a power‑heavy data centre.

KenGen manages the Olkaria geothermal field, and Microsoft and G42 intended to run the planned data centre solely on geothermal power.

A lake under pressure

Lake Naivasha, a freshwater body in Kenya’s Rift Valley, sustains agriculture, tourism, livestock and domestic water supplies, while its basin also accommodates geothermal projects and other economic ventures.

Grace Kimani, a patrol leader for Lake Naivasha and Oloiden, informed Al Jazeera that the lake faces mounting pressure from rising population, agricultural expansion, water extraction, climate swings, pollution and ecosystem decline.

“The proposed Microsoft‑G42 data centre in Olkaria could deliver jobs and investment, yet its water requirements risk exacerbating existing competition, especially during dry spells,” she remarked.

Kimani noted that scant public details exist regarding the project’s anticipated water consumption, source and cooling methods, stressing that transparency and a cumulative impact assessment are essential.

She advocated for water‑efficient or water‑free cooling systems, water recycling, use of treated wastewater, sustainable withdrawal limits and community participation in monitoring.

Silas Wanjala from the Lake Naivasha Riparian Association told Al Jazeera that the area relies heavily on groundwater and that diminishing inflows are intensifying pressure on water supplies.

“Data‑focused firms such as EcoCloud will require substantial water precisely when rivers are drying and overall demand is climbing,” Wanjala observed.

The Olkaria EcoCloud Data Centre serves as a local partner in the G42‑led effort. In 2024, the Kenya News Agency reported that G42, Microsoft and EcoCloud signed a letter of intent for the broader data‑centre initiative, noting that EcoCloud had earlier entered into a memorandum of understanding with G42.

Wanjala cites historical fluctuations in Lake Naivasha as a cautionary tale.

“In 2010 the lake almost disappeared because of over‑abstraction, and a similar scenario could unfold if water demand from Olkaria investors continues to rise,” he warned.

His concerns fit within a broader picture of water scarcity in Kenya. The UN Food and Agriculture Organization estimates the country has roughly 527 cubic metres (527,000 litres) of freshwater per capita—below the 1,000‑cubic‑metre scarcity benchmark—and projects that figure could drop to around 475 cubic metres per person by 2030.

While these numbers do not quantify the potential impact of the proposed data centre on Lake Naivasha, they illustrate why adding another major water consumer is drawing close examination in a water‑stressed region.

How much water would it use?

The precise water needs of the planned Microsoft‑G42 facility remain unknown.

The original announcement did not include any projected water‑use figure.

Current industrial consumption provides some context.

A KenGen environmental and social impact assessment recorded that 195,165 cubic metres of water were withdrawn from Lake Naivasha in July 2023 for domestic and commercial purposes at Olkaria and for operations and domestic use at Eburru.

Of that amount, 153,918 cubic metres served commercial activities at Olkaria, and the abstraction was recorded as falling within permitted levels set by the Water Resources Authority (WRA).

These statistics pertain to current KenGen operations, not to the planned data centre.

Farmer Eskimos Kobia, speaking with Al Jazeera, warned that the impending competition goes beyond households and livestock, noting that farmers, pastoralists, schools and investors will all experience heightened pressure as water demand rises.

Kimani added that climate variability has caused lake levels to swing between floods and extended dry spells.

“Water quality suffers from agricultural runoff, untreated wastewater in certain zones and invasive species,” she remarked.

Investment versus local concerns

Not all residents of Naivasha are opposed to the investment.

Absolom Mukhuusi of the Naivasha Professional Association told Al Jazeera that the technology sector could generate jobs, infrastructure and new enterprises for the region, but he stressed that economic gains should not be achieved at the cost of local communities.

“While we welcome the investors, our greatest worry is what will happen to our water sources and communities if water is diverted to Olkaria for large‑scale users,” he said.

Could technology help?

Geologist Kenyatta Otieno, speaking with Al Jazeera, identifies an additional potential advantage.

He notes that large flower farms once exerted considerable pressure on the lake’s ecosystem, but many have since departed or reduced their activities.

Otieno says the planned centre would have incorporated a resource hub to track lake levels and weather patterns, a capability that could help pinpoint peak water levels over time and inform riparian zoning decisions.

“A facility designed with water conservation at its core would be forward‑looking for a generally water‑scarce Naivasha and could serve as a blueprint for future development,” Otieno stated.

Kenya already possesses regulators tasked with balancing competing demands. The Water Resources Authority (WRA) governs water abstraction and grants usage permits, whereas the National Environment Management Authority (NEMA) supervises environmental impact assessments within the national regulatory framework.

Al Jazeera’s attempts to secure comments from WRA and NEMA officials went unanswered, and outreach to Microsoft‑G42 representatives and Kenyan government officials for information on the project’s status and water needs likewise failed.

At present, the project’s final scale, design and water requirements remain uncertain, according to KenGen.

“We are now competing with multibillion‑dollar corporations for water, and we fear we will lose out in the long run,” Leshishi said.

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