Data centres have existed for decades. So why are they so controversial now?

The Conversation, September 14, 2026, Johanna Lim, Research Associate, Strategic Technologies, University of Sydney

Until recently, data centres attracted relatively little public attention. They were largely treated as invisible pieces of digital infrastructure: essential but rarely discussed outside technical and industry circles.

But over the past 12 months across Australia, data centres have become the subject of intense political debate, community opposition, planning disputes and parliamentary inquiries.

Questions are being raised about how much electricity and water they use, where they should be built, who should pay for the infrastructure needed to support them, and whether Australia benefits from their continued expansion.

These questions are feeding into government policy. Following Prime Minister Anthony Albanese’s speech at the University of Sydney in July, a National Cabinet meeting in August reaffirmed plans to legislate nationally consistent mandatory standards for large data centres by early next year. These will include requirements around their energy, water and land use.

So how did a piece of digital infrastructure that once attracted relatively little public attention become such a prominent policy issue? Data centres themselves are not new. What has changed is their scale, purpose and the resources required to support their growth………………………………………………………………………………………………………………………………………………………………………..

Australia currently has over 160 operational data centres, with most located in New South Wales and Victoria. There are at least another 90 facilities in the development pipeline.

The data centres now being proposed are also considerably larger than many existing data centres.

Data centres in Australia

A non-exhaustive list of 283 data centres in Australia. Many do not publicly declare their power capacity nor their intended use – not all data centres are used for AI. [MAP HERE on original]……………………….

Data centres in Melbourne

There are at least 58 data centres online or in development in the Melbourne area. Points sized by capacity, the largest being the proposed 2.4GW Plumpton Data Centre. [MAP HERE on original]………………..

Data centres in Sydney

There are at least 82 data centres online or in development in the Sydney area. Points sized by capacity, the largest being the 1.2GW Kemps Creek data centre. [MAP HERE on original]…….. For example, the proposed 1.2 gigawatt Mamre Road Data Centre in Sydney would cover an area equivalent to the size of 52 rugby fields.

If built to its maximum capacity, it would become Australia’s largest single electricity user.

Why AI is driving bigger data centres

Hyperscale data centres typically contain at least 5,000 servers, occupy at least 10,000 square feet of physical space, and can draw over 100 megawatts of power. That’s enough to meet the annual electricity needs of more than 50,000 households.

In 2025, hyperscale operators accounted for 48% of global data centre capacity.

Cloud computing and the growth of everyday digital activity initially drove the expansion of these large, centralised facilities. But since OpenAI launched ChatGPT in late 2022, AI has rapidly accelerated this growth.

AI workloads are far more computationally intensive than traditional digital services. They are expected to account for approximately 70% of data centre demand by 2030.

Training advanced AI models requires dense arrangements of specialised chips working simultaneously to process large volumes of data. This can run continuously for weeks or months.

Once trained, AI models also require computing power to respond to users. This process is known as inference. While a single interaction requires considerably less computing power than training a model, that demand adds up across millions of users………………………………….

What comes next for Australia?

The growth of Australia’s data centre market is unlikely to slow anytime soon.

Australia remains a competitive destination for data centre investment, with strong government support, continued interest from major technology companies and an estimated A$150 billion in data centre buildouts by 2030.

But community opposition is emerging as a significant risk for new developments. This opposition is, in part, because of the land, power and water data centres consume.

But it’s also because there is uncertainty over whether the significant investment in AI infrastructure will truly generate sufficient economic returns – and who will benefit from those returns.

The future growth of Australia’s data centre sector may therefore depend less on whether there is demand or capital to build them, and more on where they can be built, who bears the costs, and whether communities benefit from hosting them. https://theconversation.com/data-centres-have-existed-for-decades-so-why-are-they-so-controversial-now-290253?utm_campaign=the-daily-39522&utm_content=the-daily-39522_au%7C1%7C39522%7C1888424b&utm_medium=email&utm_source=braze&utm_term=explaining+why+we%E2%80%99re+all+talking+about+data+centres+now%2C+and+what+they%E2%80%99re+actually+for