The planned NZD 3.5 (USD 2.03) billion data centre in the South Island‘s Makarewa has raised concerns about energy, noise, and water usage.
People residing near the site of New Zealand‘s (NZ) intended first AI data centre are calling for greater transparency about the project. Their concerns primarily focus on how the centre’s significant energy and water usage, along with potential noise pollution, may impact them.
Singapore-based enterprise Datagrid has secured approval to build a NZD 3.5 (USD 2.03) billion AI datacentre on a 49-hectare site in Makarewa. It’s just north of NZ’s southern-most city, Invercargill. Construction’s due to commence this year, with the centre becoming operational in another 2 years by ’28.
Datagrid’s website states that this facility can serve purposes beyond data storage, including AI training and processing. Furthermore, they intend building a high-speed internet cable between Invercargill & Australia.
Datacenters need large volumes of energy, water & land. Their rapid growth is igniting global debate and protests. This situation is due to communities grappling with the associated environmental issues and increasing energy bills, besides claims that they aren’t seeing local economic benefits, despite the promises of data enterprises.
The intended Makarewa centre is likely to become NZ’s second-largest energy user. The nearby Tiwai Point aluminium smelter uses 280 MW of energy.
Local authorities have hailed the project as a regional win. They added that the project may create jobs and speed up internet access. The enterprise estimates that approximately 1,200 jobs could be created during the initial construction phase. Additionally, about 50 permanent positions are expected to be available upon completion.
Economic geographer Angus Dowell, whose PhD project focuses on the construction of data centres, said that there were a lot of red flags about the project. He also mentioned New Zealand’s efforts to establish itself as an AI hub.
Dowell added that the centres may provide short-term economic benefits in the form of construction work. However, they’re very low employers in the long term. So, the long-term benefits to local economic development are merely not there, so they don’t stack up.
Residents in the neighbouring community are concerned about this development.
Kelly Bloomfield, the chair of the Southland Sustainable Resource Coalition, which is an advocacy group that monitors regional infrastructure projects, said that locals down here kind of feel like they’ve had the region sold out from underneath their feet.
Bloomfield added that she thinks that most people’s actual concern is that they don’t find out anything until it’s done. She also said that attempts to gather more information from Datagrid have been unsuccessful.
The centre is part of the NZ government’s efforts to attract foreign investment, in addition to building data centres. The government agency, Invest New Zealand, intends to secure NZD 25-30 (USD 14.5–17.4) billion in foreign investment to create datacentres & AI infrastructure, said the agency.
The agency further shares on its website that NZ offers a compelling opportunity besides a safe harbour for investment. This is due to its access to renewable energy and available land besides a cool climate.
Excellent digital connectivity supports these fundamentals. by excellent digital connectivity. Additionally, a skilled workforce, internationally competitive pricing, and a strong rule of law are essential factors.
Meanwhile, a report from Boston Consulting Group for the agency claims the industry may unlock up to NZD 70 (USD 40.6) billion of economic activity over the next decade.
Makarewa resident Amanda, who wished to share her first name only, said that her early ambivalence about the project has changed to concern.
Amanda added that now that she knows a lot more from what she has seen overseas, she’s alarmed, not merely for Makarewa but for New Zealand.
Amanda asserted that she was concerned about the use of both energy & water. The potential of operating 84 diesel generators in case of an energy shortage. Furthermore, round-the-clock noise and light may affect the community, besides farm animals.
