Datacenters Compete with Housing in Sydney

Datacenter development in Sydney is raising significant concerns among local councils, with reports of increased blackouts and competition for land suitable for housing. Lane Cove Council has noted a rise in power disruptions potentially linked to datacenters and expressed worries about noise and generator emissions. The City of Ryde pointed out that datacenters are occupying prime locations near public transport hubs that could otherwise accommodate new homes.

Further pressure is being placed on Sydney's water supply, with some approved housing projects delayed due to insufficient capacity from Sydney Water. Penrith City Council is urging a halt on new approvals until the full impact on utility services is understood. The Western Sydney Regional Organisation of Councils warns that the cumulative environmental impacts of datacenters, including noise and heat, are significant and could constrain essential housing and infrastructure delivery.

The potential demand for power and water from datacenters is substantial; if all proposed facilities are built, they could require approximately 4.4 gigawatts of power, enough for 10 million households, and consume up to 25% of Sydney's drinking water by 2035. The industry body, Data Centres Australia, attributes these needs to cooling systems and notes efforts to use renewable energy and non-potable water, but highlights cost and supply barriers. The federal government has issued national expectations for datacenters, and a NSW inquiry is examining the effects on housing, land use, and communities, with public hearings scheduled.