Data centre builders will stump up their own water and energy under new rules aimed at ensuring the industry meets community expectations.
Builders will have clear expectations on energy, water and environmental standards, community consultation and infrastructure contributions to access fast-tracked assessment, the NSW government said when unveiling its AI plan on Monday.
Alongside the plan, the state’s independent pricing regulator will review how much data centres were charged for water, while the AI Office will continue to look at public investment to support artificial intelligence.
More than 60 data centres operate or are being built in NSW amid growing concerns about the facilities, especially in Sydney where the large, windowless and energy-intensive buildings are being built close to homes.
Treasurer Daniel Mookhey called the policy nation-leading, declaring it would ensure responsible investment.
“NSW is always going to be a premium destination for data centre construction which means we are entitled to ask builders to deliver a community benefit,” he told reporters.
“Data centres need to pay their own way. They need to bring additional power and additional water to offset their demand, but also to pick up some of the slack that otherwise would fall to households.”
The treasurer expected data centres to fully offset their power and water needs after four years of operation, before adding extra capacity to water and power reserves.
Some 19 projects – worth around $50 billion – are in the State Significant Development pipeline – an accelerated process for large builds determined by the planning minister or Independent Planning Commission, instead of councils.
The guidelines would be reviewed in 12 months, he said.
In years of drought, the framework protected household water supply by getting data centres to use recycled water, Water Minister Rose Jackson said.
“That is a really important element … not having households and data centres in competition for the same potable water source,” Ms Jackson told reporters.
Energy Minister Penny Sharpe said with data centres potentially accounting for 11 per cent of state energy usage by 2030, the reforms held operators to high renewable energy standards.
“When it comes to energy it’s very clear – data centres need to enter into agreements for renewable energy to make sure they’re powered that way. They also need to cover the cost of network connections,” Ms Sharpe told reporters.
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