Australia’s Largest Planned AI Data Centre Faces Sustainability Hurdle
Synopsis
The developers behind OpenAI's proposed 612MW facility have switched to conventional cooling after recycled water infrastructure proved unavailable.
Australia's biggest planned AI data centre has tweaked its main design following the scrapping of plans to cool the facility with recycled water, and instead has gone for a system that doesn't use water but uses more electricity.
The change will impact the proposed 612MW campus under construction by NEXTDC for the computing infrastructure of OpenAI in Western Sydney.
Cooling Plan Changes After Pipeline Approval Fails
The original plan was to use treated recycled water from a separate pipeline, thereby saving drinking water and increasing energy efficiency. However, it was not possible to obtain planning permission for that pipeline so the planning team opted for a closed-circuit liquid cooling system.
The new plan involves circulating coolant around the high-performance computing gear, and then air cooling, NEXTDC said. The design does not use any water for operation, but requires more electricity than the previous design.
AI Growth Puts Pressure on Infrastructure
The re-design is part of the process as governments and utility companies consider the speed at which AI infrastructure will impact power and water resources. This Energy and AI report by the IEA (2025) suggests that by 2030 the electricity demand of data centres will exceed 945 TWh, a staggering 218% increase from the current 451 TWh, powered by artificial intelligence.
In New South Wales, Australia, planning provisions have been made for energy efficiency and water management for major data centres. The same discussions are ongoing in Ireland, Singapore and the Netherlands, where governments are considering the capacity of the grid, the availability of water and planning permission as new and existing AI facilities continue to grow.
The company will continue to use recycled water as its first choice of cooling where infrastructure exists to support it, says NEXTDC Chief Executive Craig Scroggie.
The project also arrives as OpenAI remains on a computing power investment spree after its US$40 billion funding round in 2025 valuing the company at US$300 billion. The investment will help support increasing demand for artificial intelligence services by expanding the infrastructure.
Source: Reuters
Pooja Malik is a business journalist with over six years of experience covering startups, entrepreneurship, and emerging trends. She has previously worked with leading media platforms such as YourStory Media and BW BusinessWorld, where she reported on business, policy, and market developments. Currently, she serves as Editor at The Inspirepreneur Magazine, where she writes and edits stories across business, lifestyle, and travel, with a focus on clarity, accuracy, and reader relevance.
