Key facts
- A NZ$3.5bn AI datacentre is planned for Makarewa, New Zealand, by Singapore-based Datagrid.
- The facility will be the country's second-largest electricity consumer, using 280MW.
- Local residents are demanding more transparency regarding environmental impacts and economic benefits.
- The project is expected to create 1,200 construction jobs and 50 permanent positions.
- Datagrid has approval to use up to 84 diesel generators and draw significant groundwater.
Plans for New Zealand's first AI datacentre, a NZ$3.5bn project by Singapore-based Datagrid in Makarewa, are facing significant local opposition due to concerns about transparency and environmental impact. Residents are calling for more information regarding the facility's substantial electricity and water consumption, potential noise pollution, and the long-term economic benefits for the region.
The Makarewa datacentre is set to become New Zealand's second-largest electricity user, consuming 280MW, and will also require significant water resources. While local authorities and the company highlight job creation during construction and operation, an economic geographer, Angus Dowell, expressed skepticism about the long-term economic advantages, noting that datacentres are typically low employers once built.
Community groups, like the Southland Sustainable Resource coalition chaired by Kelly Blomfield, feel that the region's future is being decided without adequate consultation. Residents like Amanda are alarmed by the potential impacts, including the use of up to 84 diesel generators during power shortages, significant water withdrawal, and round-the-clock noise and light pollution affecting both the community and local farm animals. Environment Southland reports indicate approvals for air contaminant discharge from generators, substantial groundwater withdrawal, and wastewater discharge, along with the removal of a nearby wetland.
Datagrid's CEO, Rémi Galasso, has previously suggested that concerns about water and power use are unfounded, citing the region's cool climate and plans for renewable energy arrangements. However, critics like Dowell point to a general lack of transparency surrounding such projects, questioning their true benefits to New Zealand and the broader AI ecosystem.
The project is part of a broader government initiative, with Invest New Zealand aiming to attract NZ$25-30bn in foreign investment for datacentres and AI infrastructure, touting New Zealand's renewable energy, land availability, and cool climate as key advantages. A Boston Consulting Group report suggests the industry could unlock up to $70bn in economic activity over the next decade.