What does a good data centre future look like? And how do we get there?

The future of data centres in Australia is being shaped by their rapid expansion, driven by the growing reliance on artificial intelligence tools. These sprawling warehouses of computer servers consume significant amounts of electricity, water, and land. To ensure a sustainable and beneficial future for these facilities, careful planning and oversight are crucial.

Without proper regulation, data centres could strain the economy, environment, and local communities, potentially increasing power bills, depleting water supplies, and hindering the transition to net-zero emissions.

However, with thoughtful design and implementation, data centres can have a positive impact. They have the potential to stabilise the electricity grid, attract investment to underdeveloped regions, and stimulate economic growth. While futuristic technologies like underwater or space-based data centres may eventually play a role, they are currently small-scale experiments that cannot meet Australia's projected demand for the coming decade.

The Australian government is currently developing the rules that will govern data centres and AI. With national legislation expected in early 2027, it is essential to establish clear guidelines that promote responsible development. A good data centre future should have three key features: the adoption of renewable energy sources, mandatory efficiency standards for energy and water usage, and careful consideration of location to minimize resource strain and community impact.

Operators should invest in renewable energy generation, rather than relying on existing supplies or fossil fuels. Mandatory efficiency standards for energy and water consumption would ensure that data centres operate sustainably and reduce their environmental footprint. Decisions regarding site selection should consider resource utilization and community well-being from the outset, potentially guiding projects towards regions with available capacity and renewable energy sources.

Additionally, hosting communities should benefit from the presence of data centres through genuine consultation, meaningful contributions such as community batteries or e-waste recycling programs, and potential upgrades to local infrastructure. By implementing these measures, Australia can foster a data centre sector that minimizes strain on public resources while delivering positive contributions to the economy, environment, and communities.