The water thing is not overblown if you consider that data centers will only use potable water and will not be able to use treated water. Per just one of many studies:

Large data centers can consume up to 5 million gallons per day, equivalent to the water use of a town populated by 10,000 to 50,000 people.

With climate change and the exacerbation of droughts around the world, this puts any source of fresh surface or groundwater at risk of drying up.

Only 3% of Earth’s water is freshwater, and only 0.5% of all water is accessible and safe for human consumption.

This is a growing environmental justice issue (and data centers encourage further energy poverty that I haven’t even addressed, much less the increasing ratio of usage for industry vs residential), and to ignore that we as humans cannot replenish or increase freshwater supplies with any meaningful scale to support life, this becomes a dire issue.

I for one would much rather have water and affordable energy for communities.