The local environmental challenge, which was dismissed, had also weighed on the development of the country's third data centre project for the company Amazon. The proposed plan to build a data centre in Santiago, Chile, was one of Amazon's biggest legal challenges in South America before being overshadowed by a challenge from local environmental activists. The decision, dated 8 May 2026, is a significant boost to the tech giant's plans to develop infrastructure in the area, paving the way for the $205 million project in the municipality of Cerrillos.  

The row had become a sticking point in a rising conflict between global tech giants in its bid to establish a larger footprint in the cloud computing space, and local communities worried about the long-term environmental consequences of huge industrial installations on the increasingly precious water supply. The lawsuit was filed by a coalition of neighbours and environmental activists that said the environmental permit issued a few years ago blindsided central Chile because of a changing climate. In particular, the data centre's cooling system would use an unnecessarily high amount of groundwater from the aquifer, which struggles to supply water due to a “megadrought” over the preceding 10 years. 

Residents' lawyers stated that the continuous accordance with industrial water in the Santiago basin had become an irreversible "tipping point" and that the Environmental Evaluation registered did not take advantage of the most recent hydrological data. They wanted the permit withdrawn or revoked, at least to a much more strict and delayed renewable permit to ensure that new computer simulations and models were used to form a diAerent opinion. But the Second Environmental Court of Santiago has concluded the administrative process carried out by the Environmental Evaluation Service (SEA) was legally correct.  

According to the court, the residents' evidence was unable to establish that the data centre would cause "irreparable harm" to the aquifer outside of the harm limits outlined in the environmental impact statement. In its ruling, the court highlighted the fact that Amazon has made considerable technical changes to its project design, where it first raised concerns about water usage, switching to an air-cooling design that would lower water consumption significantly in the project compared to earlier versions. This change was referenced as one of the reasons that the court ruled the project's impacts on the environment were well mitigated by existing Chilean regulations. Amazon Web Services (AWS) says all along that their investment is vital to Chile's digital transformation and their vision of Chile as a technology and innovation centre in the region.  

The company has highlighted its sustainability initiatives, such as holding the promise of achieving water-positive status globally by 2030 – that is, using less water in any of its data centre operations than it gives back to communities.  

The decision is a boon for the Chilean government, which is hoping to lure foreign direct investment in the high-tech industries as a way to get away from a century-long copper industry focus. Though Amazon survived the suit, it's a relatively new occurrence of states challenging giant tech firms worldwide with "water litigation.  

In the Netherlands, Arizona and beyond, the overwhelming demand for data to fuel artificial intelligence and cloud-based services is increasingly coming into conflict with regional environmental safeguards. The residents of Cerrillos were extremely disappointed by the ruling and are planning to take the case to the Supreme Court; the immediate route for construction has now been cleared. 

The project will create hundreds of working positions throughout the process of its construction and will ensure the centre of a new category of digital services of the Southern Cone. Ground-breaking activities on the location are a reminder that the need for water in comparison with the need for data is a section of 21st-century conflict that's simply not going away.