Data centres in urban areas:
Water consumption: Data centres rely on huge volumes of fresh water for cooling. In mid-2025, proposed data centres in Melbourne’s North and West had the potential to consume 20GL of potable water per annum, equating to 4% of the city’s total use.
Delaying energy transition and increasing electricity costs: Data centres used 4 million megawatt hours or 2.2% of electricity in the east coast grid in 2025. This is expected to triple by 2030 and increase eightfold by 2050 according to the Australian Energy Market Operator.
Local air pollution: Diesel backup generators used by data centres can have air quality and human health impacts when located in proximity to residential communities. They emit hazardous pollutants such as nitrogen oxides and fine particulate matter, increasing the risk of respiratory disease, cardiovascular conditions, and elevating cancer risk in nearby communities.
Noise pollution: Persistent noise from cooling systems, as well as intermittent use of onsite back-up generation, affects nearby communities and wildlife.
Undermining other community needs: There are real risks that data centre builds in cities will take up land that could otherwise be used to build new housing.
NT Fracking and data centres:
Water Consumption: Two of the known data centre projects proposed in the NT have the potential to draw billions of litres from precious water sources each year for cooling. In addition, the gas fracking required to run the data centres would use vast amounts of water and also risks contaminating groundwater sources that recharge NT rivers and springs, and which are relied upon by communities.
Climate change: Gas guzzling hyperscale data centres will drive fracking in the Beetaloo Basin. The Beetaloo Digital project could consume around 146 petajoules of gas per annum, meaning it would more than double the Northern Territory’s gas use, which is currently around 140 petajoules per annum. Fracking in the Beetaloo Basin would unleash a climate bomb, generating 1.2 billion tonnes of emissions and increasing Australia’s emissions by up to 20 per cent. Meanwhile the Northern Territory is forecast to become unliveable due to climate change within a couple of generations.
Suggested recommendations to the Senate Committee
- In addition to Sydney and Melbourne, the Committee must hold public hearings in Darwin to provide local communities an opportunity to contribute to the public discourse on this matter of importance.
- An immediate moratorium on data centre construction above 50MW until the government has enacted firm social and environmental safeguards.
- Data centres must not create demand for fracked and conventional gas in any way.
- No public funding for data centres or enabling infrastructure.
- Rollout of the data centre industry, including in the Northern Territory, must be informed by a strategic regional assessment to understand the cumulative risks for nationally significant animals, plants, habitats and places.
- The right to free, prior and informed consent for Traditional Owners must be established as a central pillar of Australian data centre regulations.
- Ensure data centres have best practice water efficiency, do not harm precious water resources and ensure community and environmental water needs are prioritised.
- Data centre proponents must be obligated to prepare comprehensive modelling before environmental assessments are open for public comment to allow for a clear understanding of water requirements, energy requirements and source, wastewater treatment, sound and lighting impacts along with a comprehensive flora and fauna study.