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The issue is heat. If your data center consumes 100 megawatts, that's 100 megawatts of electricity that turns into 100 megawatts of heat. Part of the challenge of a data center is getting rid of that heat and keeping the servers cool.
There's a fun little principle called latent heat in phase change. To take 1 g of water and heat it from just above freezing to just below boiling consumes about 100 calories of energy. To then boil it, to raise it just a fraction of a degree and turn it into steam, takes another 433 calories of energy. So if your data center has 100 megawatts of heat to get rid of, turning water into vapor is a great way to get rid of it.
You don't actually even need to boil the water, if you take warm water and spray it into the air, some of it will evaporate and the water that comes back on the ground is significantly colder than what you sprayed in the air. This is harnessed with a machine called a cooling tower, it's a big boxy thing that has a ton of little waterfalls and wet plates inside it while a giant fan blows tons of air through it. You pour warm water in, some of it evaporates, the water that comes out is much colder. Many buildings use this as part of their air conditioning system. But when that water evaporates, you need more water to replace it. And that's why they say data centers consume water. The water isn't destroyed, but it is released into the atmosphere as steam or humidity and thus is no longer usable until it rains again. Which, depending on your climate, may be sometime away or may be some distance away.