McQuoid said: \u201cWe might move across the road and ruffle a few feathers later.\u201d <\/p>\n
On his group\u2019s Facebook page, he stressed that protests should be peaceful.<\/p>\n
\u201cWe\u2019re really concerned with what these things [data centres] will do to the land, what they\u2019ll do to the air and obviously power and water,\u201d McQuoid told the Herald.<\/p>\n
In the US, where data centres have been blamed for rising utility bills and noise pollution, the state of New York recently placed a one-year moratorium on the construction of new \u201chyperscale\u201d facilities (data centres that consume more than 50 megawatts of power). <\/p>\n
The move followed various cities and counties across a mix of \u201cred\u201d and \u201cblue\u201d states introducing similar bans. <\/p>\n
McQuoid\u2019s group would like NZ to follow suit. <\/p>\n
\u2018I don\u2019t see any pros\u2019 – academic<\/p>\n
In comments to the Herald immediately before the protest, Alex Sims, a Commercial Law Professor and technology specialist with Auckland University, said: \u201cI don\u2019t see any pros about hyperscale data centres being built in New Zealand\u201d.<\/p>\n
Sims said multinational data centre owners sent profits offshore. <\/p>\n
\u201cTech companies are experts at minimising the tax they pay in high-tax countries such as New Zealand,\u201d she said.<\/p>\n
\u201cJust look at the low taxes that Meta, Google and Amazon pay in New Zealand, despite earning large revenues here. For example, Amazon paid only $4.9m tax on the $480m in New Zealand revenues, with $353m sent overseas in \u2018cloud fees\u2019.\u201d<\/p>\n
Sims was quoting numbers for Amazon Web Services NZ. Amazon also has a second NZ subsidiary, Amazon Data Services, set up for its local data centre operation, which reported a $37.5m loss last year after taking a $45m impairment on its abandoned Auckland data centre build.<\/p>\n
\u201cGiven the issues with noise and vibrations, data centres should not be built within 4km of any housing,\u201d Simms added.<\/p>\n
\u201cGiven that the hyperscale data centres will affect the whole of New Zealand, the public needs to have its say. There needs to be a binding referendum on the issue” – Professor Alex Sims<\/p>\n
\u201cAnd as part of that, data centres should be required to buy the land within 4km of the edges of the data centres.<\/p>\n
\u201cAlso, it\u2019s not a case of not being able to use AI. There are many types of AI, some require a lot of computing power and use of electricity and others do not.\u201d<\/p>\n
\u201cYou must have public consultation and if the public in the area do not want it, then it should not be forced upon them.<\/p>\n
\u201cGiven that the hyperscale data centres will affect the whole of New Zealand, the public needs to have its say. There needs to be a binding referendum on the issue. I know referendums are not binding in New Zealand, but all the political parties can agree to abide by the results.\u201d<\/p>\n
Event speaker recognises concerns<\/p>\n
Notwithstanding its billing, the event at the Cordis didn\u2019t feature leadership from any of the big US firms who are driving the global data centre boom.<\/p>\n
The speaker lineup did include Technology Users Association of NZ chief executive Craig Young, who told the Herald his group took a neutral view. <\/p>\n
\u201cLike any technological advance, data centres can be good if done the right way.<\/p>\n
\u201cLike any technological advance, data centres can be good if done the right way” – Tuanz CEO Craig Young. Photo \/ Sylvie Whinray <\/p>\n
\u201cWe see there being significant upside to having data centres operating in NZ from the perspective of sovereignty of our country\u2019s data, as well as providing a service to offshore customers. <\/p>\n
\u201cWe recognise the concern over the use of electricity in particular and really want providers and the electricity sector to be innovative on how we can and should increase our ability to electrify our economy in a sustainable and cost-effective way.\u201d<\/p>\n
A render of Datagrid’s proposed Southland data centre, with a proposed substation front left. Inset: Founder and executive chairman Remi Galasso.<\/p>\n
Noise<\/p>\n
The \u201cAI factory\u201d that Datagrid plans for Southland has been a flashpoint.<\/p>\n
Datagrid founder and executive chairman Remi Galasso recently told the Herald his company had listened to community feedback and acted on fears about noise.<\/p>\n
\u201cWe have been actively engaged with the Southland community for more than four years. This includes close collaboration with Southland District Council, Invercargill City Council, Environment Southland, the Southland Business Chamber, Great South, the four local r\u016bnanga, Ng\u0101i Tahu, and Te Ao Marama Inc,\u201d he said.<\/p>\n
READ MORE <\/p>\n
\u201cWe have secured written support from all directly affected neighbours following extensive consultation, during which we listened to their concerns and modified our design accordingly.<\/p>\n
\u201cAdditional mitigation measures include a 6m-high bund around the site to minimise visual and noise impacts, as well as the acquisition of an extra 10ha to construct a new dedicated access road directly on to Highway 98 \u2013 completely avoiding Flora Rd and the nearby primary school.\u201d<\/p>\n
In 2022, after gaining Overseas Investment Office (OIO) consent, Datagrid bought a 43ha site at 370 Flora Rd East, Makarewa, about 15 minutes north of Invercargill. In 2024, it added the adjacent 342 Flora Rd in 2024.<\/p>\n
Water<\/p>\n
Datagrid has been consented to take up to 220 million litres of groundwater each year to cool the servers within its six data halls.<\/p>\n
But Galasso maintains Datagrid\u2019s 280MW facility (with plans to upgrade to 1GW \u2013 or more than twice the power consumed by the Tiwai Pt smelter) will only need to use a fraction of that allocation.<\/p>\n
\u201cThe actual water consumption will be very low, much smaller than, say, a dairy farm,\u201d Hamilton said.<\/p>\n
A 1000-cow dairy farm could use up to 20 million litres per year. How will Datagrid stay below that?<\/p>\n
\u201cMany data centres evaporate millions of litres a year to stay cool on hot days,\u201d Galasso said.<\/p>\n
\u201cOne of the reasons we chose Southland is that we don\u2019t have to. The cool climate here means our systems can be held at temperature through heat exchange with the ambient air \u2013 no evaporative cooling, and cooling fans turning over at low speeds.<\/p>\n
Today’s protest opposite the Cordis. Photo \/ Jason Dorday<\/p>\n
\u201cAnd the liquid that does the cooling runs in a closed loop. It never meets Southland\u2019s waterways, aquifers or soil, so there is nothing for it to contaminate.<\/p>\n
\u201cThe criticisms circulating about our project are largely unfounded and appear to stem from incomplete or incorrect information.\u201d<\/p>\n
Microsoft and CDC have both said that their Auckland data centres used a mix of air cooling and closed-loop water cooling (or one lot of water recirculated) rather than the water-intensive evaporative cooling that has caused controversy in the US and elsewhere overseas.<\/p>\n
Power<\/p>\n
Earlier this week, CDC and Contact said they had partnered to explore the possibility of a 250MW data centre in Stratford, Taranaki.<\/p>\n
Contact CEO Mike Fuge was asked on Ryan Bridge TODAY: \u201cEnergy-wise, will it wash its own face?\u201d<\/p>\n
\u201cYes. Absolutely,\u201d Fuge said. \u201cAnd it will be water-neutral.\u201d<\/p>\n
\u201cThat data centre in Stratford has a renewable energy project around it in the solar farm. It\u2019s connected to new renewable projects in Taup\u014d, in Taihape and in Southland.\u201d<\/p>\n
The depletion of the Maui gas field off Taranaki had led to a boom in renewable investment equivalent to two Maui fields, Fuge said. Data centres would take advantage of the new capacity. <\/p>\n
The Big Tech firms say they have already been bankrolling renewable power.<\/p>\n
In 2023, Amazon \u2013 which says it will spend $7.5b over 15 years on building up its local data centre capability, even though progress so far has been often mysterious \u2013 signed a deal with Mercury to buy 50% of the electricity generated from its 222MW Turitea South wind farm, which was opened two years later, while a 10-year contract with Microsoft supported Contact Energy\u2019s investment decision to construct the Te Huka 3 geothermal power station.<\/p>\n
Sharp Albo?<\/p>\n
Australian Prime Minister Anthony Albanese recently created an Office of AI within the Office of the Prime Minister and Cabinet, and said there would be new rules around data centres, including that they must pay for the construction of their own power.<\/p>\n
On the carrot side, the Aussie PM promised fast-track approval for new data centres that met the new criteria.<\/p>\n
New Zealand Prime Minister Christopher Luxon said he had met Albanese shortly after his announcement and New Zealand would follow a similar approach.<\/p>\n
New data centres would need to underwrite new renewable power generation rather than draw from the existing grid, Luxon said. Guidelines were pending. <\/p>\n
\u201cWhat Australia is proposing is better than nothing,\u201d Sims said. <\/p>\n
She noted that at this stage, Albanese\u2019s ideas were just proposals, yet to be legislated. <\/p>\n
\u201cI don\u2019t think anything should be fast-tracked,\u201d Sims said. <\/p>\n
\u201cPlus, you must have public consultation and if the public in the area do not want it, then it should not be forced upon them.\u201d<\/p>\n
Jobs<\/p>\n
In an Overseas Investment Office (OIO) application, Microsoft said a new data centre in West Auckland would create \u201c300 temporary FTE [fulltime-equivalent] jobs during construction… and 50 new FTE jobs once the data centre is operational\u201d.<\/p>\n
Contact and CDC say its data centre would create a peak 600 jobs during construction.<\/p>\n
In a regulatory filing, Datagrid said construction of its hyperscale data centre would create 1200 jobs, with the facility requiring a staff of 75 once up-and-running.<\/p>\n
But Galasso recently told the Herald that was lowballing it. <\/p>\n
\u201cTwo hundred to 300 jobs is a good estimate\u201d after the data centre is built, he said.<\/p>\n
Local control<\/p>\n
Crown agency Invest New Zealand recently embarked on a push to attract $25 to $30 billion in offshore investment in data centres and associated infrastructure over five years \u2013 which it says would generate between $70b and $160b in new economic activity.<\/p>\n
The drive drew criticism from Don Christie, the managing director of Wellington-based IT and cloud services firm Catalyst, and co-founder of now-defunct ginger group NZRise.<\/p>\n
The Stop Data Centre NZ Group protests outside the Data Centre Leaders Summit at the Cordis in Auckland today. Photo \/ Jason Dorday<\/p>\n
\u201cThere are no knowledge economy jobs coming our way just by building giant refrigerators here,\u201d Christie said.<\/p>\n
The hyperscalers shifted revenue and profit offshore, minimising the local tax they paid, he added.<\/p>\n
He was also dubious that new renewable power would accommodate new data centres. The reality in Europe had been a spike in gas and coal use, he said.<\/p>\n
Christie added: \u201cIf we build data centres for New Zealand, on a New Zealand scale, which is what T4 Group and Datacom and others have been doing<\/a>, that\u2019s a completely different thing.\u201d<\/p>\n Locally-owned Datacom and small data centre operator Datacentre220 both had representatives at today\u2019s conference.<\/p>\nToday’s data centre protest opposite the Cordis. Photo \/ Jason Dorday<\/p>\n