Australian utilities warn data centre demand risks

Energy and water utilities warn the strain on capacity from a more than A$100 billion ($70 billion) data centre build-out in Australia’s biggest state could sharply push up household bills. In submissions to a New South Wales state parliamentary inquiry, the utilities said existing laws were insufficient to protect consumers from bearing the rising costs. The submissions increase pressure on the government to set limits on how rapidly expanding data centre projects use electricity and potable water shared by local communities, with critics contending that careful planning has been pushed to the sidelines in the rush to secure a piece of the multi-trillion dollar global data centre boom. Reuters previously reported that the state, home to Sydney and one-third of Australia’s 27 million population, had approved 10 data centre projects from companies including Microsoft and Amazon without setting specific, enforceable parameters for resource consumption. “Without appropriate policy s
ettings, this growth could place pressure on electricity infrastructure planning, system reliability and ultimately consumer costs,” Jason Krstanoski, an executive at grid operator Transgrid, wrote in a submission. “This principle is non-negotiable – existing customers should not subsidise new large loads.” Transgrid has received connection inquiries from data centre developers totalling more than 10 gigawatts – more than half the state’s current peak demand, according to data published by the energy regulator – in the past 18 months, the submission said. Some individual facilities were seeking more than 1,200 megawatts, it said. The New South Wales planning department did not immediately provide a response to a Reuters request for comment. Meanwhile, the Water Directorate – which represents 92 council-run local water utilities across New South Wales – said there were “few places” in the state equipped to support the scale and pace of data centre growth w