TL;DR · 30-second read
The Short Version
A company linked to businessman Kevin O’Leary wants to build a huge computer campus in northern Utah, with fifteen gas power plants of its own on site.
The surprise is the water. The company says it needs about two gallons to make the electricity a typical home uses in a month. It also says the Great Salt Lake will get more water than it historically has.
One scientist says today’s best power plants are nowhere close to that. Utah regulators will now take public objections.
KSL reported that O’Leary Digital Utah DC Sub I, LLC, associated with businessman Kevin O’Leary, filed an application on Oct. 15, 2026 with the Utah Division of Water Rights to permanently change water use from irrigation to supply the proposed Stratos Project in Box Elder County.
The nearly 200-page filing describes 11 clusters of data center buildings, 7.5 gigawatts of on-site gas generation arranged as fifteen 500-megawatt blocks, and 4,850 operating employees. The application will be publicly advertised for two weeks, followed by a 20-day protest period.
Executive Summary
The Stratos Project application offers the most detailed public view so far of a very large proposed data center campus. It includes a water mass balance report by Beairsto & Associates and a hydrologic and depletion analysis by Loughlin Water Associates. The developers argue that the project would use less water than the land’s historical agricultural use and that more water would reach the Great Salt Lake from Salt Wells Spring Stream.
The most contested number is about two gallons of make-up water per megawatt-hour of electricity, the figure given by O’Leary Digital CEO Paul Palandjian. Make-up water is the fresh supply added to replace what a cooling system loses. Ben Abbott, an ecologist and executive director of the nonprofit Grow the Flow, says the proposed ratio would be 10 to 100 times better than today’s top-performing facilities if reciprocating engines are used, and has no precedent if combined-cycle turbines are used.
The dispute matters beyond one Utah campus. On-site generation can make cooling design central to whether a project is viable, because the power plant’s water needs become part of the data center’s own permit case.
Two Gallons Per Megawatt-Hour Carries the Water Case
The project’s water argument depends on one engineering claim. Exhibit B describes a “closed recycle loop with 90% recovery and 10% freshwater makeup,” and Palandjian translates that into about two gallons per megawatt-hour. A megawatt-hour is one megawatt of power delivered for an hour, and it is the standard unit for measuring electricity output.
Simple arithmetic shows the scale. If all 7,500 megawatts ran around the clock at that rate, the power plant would need about 15,000 gallons of make-up water an hour. That equals 360,000 gallons a day, or roughly 131 million gallons a year. If make-up is 10% of the flow, about 150,000 gallons an hour would circulate through the loop. These are our calculations from the developer’s stated figures, and they assume full output at all times, so they are an upper bound for the power loop alone at that rate.
The headline claim holds only if that rate is achievable at this scale. State reviewers, water users, Great Salt Lake advocates and any future tenants all have a stake in the answer. The report’s campus description also lists food service, showers, locker facilities and 154 acres of landscaping, so the two-gallon figure should not be read as a measure of the entire campus’s water use.
Why the Choice of Generator Changes the Argument
The plant has been described in two ways. One account of the documents refers to fifteen 500-megawatt combined-cycle natural gas plants, while the Exhibit B passage specifies a “reciprocating-engine generation facility.” The difference is material. A combined-cycle plant burns gas in a turbine and then uses the exhaust heat to make steam for a second turbine, and that steam must be condensed. Reciprocating engines are large piston engines with no equivalent steam cycle in their basic form, and their heat is typically removed through a coolant circuit.
Abbott’s critique reflects that split, calling the ratio far better than current top performers for engines and “not an example anywhere on the planet” for combined-cycle turbines. Palandjian replies that Abbott “is comparing us to plants that cool by evaporating water, and we do not.” Each position has a fair test. If the design does not evaporate water, comparisons with evaporative plants tell only part of the story. The developer’s strongest answer would then be operating data from non-evaporative plants of comparable size.
Moving away from evaporation also shifts the burden to other parts of the design. Heat still has to go somewhere, usually into the air through large radiators and fans, which can consume power and lose effectiveness on hot days. The 90% recovery figure raises a related question: where does the 10% that leaves the loop go? Those details will decide whether the two-gallon figure works as a year-round design number.
The Great Salt Lake Claim Is a Comparison With Farming
The application’s strongest language concerns the lake: “there can be no question that more water will reach the Great Salt Lake from Salt Wells Spring Stream than has reached it historically.” That is a claim about a baseline. The comparison is between the water historically consumed by irrigation and the water the project would consume in its place. This is why the filing includes a depletion analysis, which estimates how much water is actually used up and does not return to the system.
Abbott’s stated objection focuses mainly on whether the power output is achievable with so little water, which is a separate question from the farming baseline. The irrigation history could prove sound while the cooling design falls short, or the reverse. The developers’ conclusion needs both to hold, along with actual operations that match the plan over the life of the campus. The protest period is where those assumptions can be challenged formally.
On-Site Power Moves the Siting Question to Water
Building generation beside the data center changes which local resources a project leans on hardest. At this scale, a developer that makes its own electricity also takes on the water, fuel and heat-removal questions a distant power plant would otherwise carry. Stratos shows that dynamic clearly, though one Utah application is not evidence of an industry-wide pattern.
Developers considering similar campuses should note how quickly a cooling specification became the center of public debate. The other disclosed figures are more settled: 11 clusters at 400 people each plus 15 generation blocks at 30 each adds up to the stated 4,850 operating jobs. Palandjian also describes a footprint of about 2,500 acres inside a campus of roughly 10,000 acres, with the remaining 7,500 preserved. The two-gallon figure remains the number that needs the most proof.
Background
Data centers are buildings full of servers that run cloud services and other computing, and nearly all the electricity they use ends up as heat that must be removed. Large campuses therefore have to plan for power and cooling together, and those decisions can shape local water demand when evaporative systems are involved.
In Utah, changing how an existing water right is used requires an application to the Division of Water Rights. The Stratos filing covers Hansel Valley and Salt Wells Flat in Box Elder County, in a region where effects on the Great Salt Lake are a central public concern. O’Leary Digital was co-founded by Kevin O’Leary and Paul Palandjian, who serves as its chief executive officer. Source: Stratos Project water application reveals new details on massive data center, KSL’s report on the water permit application for the proposed Box Elder County campus.Sources