Humanity has entered what scientists are calling an “era of water bankruptcy.” According to the United Nations University, many critical water systems around the world are so overused — through depletion, overallocation, land and soil degradation, deforestation, and pollution, all compounded by climate change — that they can no longer be restored. 

At the same time, global warming and the spread of artificial intelligence promise to dramatically increase demand for water and clean energy across a wide range of countries.

In this complex scenario, Brazil is in a privileged position, being home to more than 12 percent of the world’s fresh water, and an electricity matrix that is more than 55 percent hydropower-based. But does an abundance of river basins truly translate into water security?

As it stands, Brazil is in a relatively comfortable position to ensure water supply for homes, industries, and crops, as well as the functioning of its hydropower plants. 

Water availability is also a crucial asset for the country on the international stage. When agribusiness exports dozens of millions of tons of soy each year, it is also indirectly exporting the water used in that process. Half of the water consumed in Brazil goes to irrigation.

When federal and local governments court foreign investment to host data centers, they are offering the water used in power generation and in the cooling systems those facilities require. Last week, the lower house even approved a bill granting tax incentives to the sector. The text will still be voted on in the Senate.

But experts warn of risks of chronic water shortages in several parts of Brazil over the coming decades, considering projections of economic and demographic growth, as well as the effects of climate change.

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