New South Wales committee rejects data centre moratorium — Channel NewsAsia

A parliamentary committee in the Australian state of New South Wales did not support introducing a moratorium on approvals for new data centres, although it identified shortcomings in the current system for assessing their impact on resources and infrastructure. Channel NewsAsia reports.

Impact assessed separately

The cross-party inquiry concluded that the state lacks a comprehensive strategy for managing the effects of the data centre boom on water supply, electricity grids and other infrastructure. The report states that current rules may underestimate future electricity demand and water resource constraints.

The committee also warned that the concentration of data centres in certain areas could increase pressure on infrastructure. According to the report, the current planning system mainly considers such facilities as individual projects, although much of their impact is cumulative and affects communities and other sectors.

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Moratorium removed from recommendations

Instead of halting the issuance of permits, the committee proposed developing a comprehensive data centre strategy and improving coordination among participants in the project approval process. Minutes attached to the report state that members of the Public Accountability and Works Committee voted 6 to 1 to remove recommendations for a moratorium at the state and national levels.

The committee chair, Abigail Boyd, a Greens representative in the upper house of parliament, was the only one to vote to retain the moratorium proposal. In the foreword to the report, she said that the rapid growth in data centres linked to artificial intelligence threatens significant water and energy consumption.

Tensions surrounding new facilities are particularly acute in New South Wales, whose capital is Sydney. There, developer NextDC and OpenAI, the company that owns ChatGPT, are awaiting approval for a data centre project, while residents of one suburb have already secured the withdrawal of a smaller project.