Public opposition to data centres is intensifying globally, threatening billions in projects and leaving company share prices in limbo. Community unrest, fuelled by concerns over soaring electricity bills, significant water consumption, and rapid infrastructure expansion for artificial intelligence, has already seen an estimated $US77 billion in North American data centre projects blocked or delayed. This growing sentiment impacts even major players as residents push back against their environmental and social impacts.
This pushback has arrived in Australia. Property developer Goodman, a global property group that develops industrial property including data centres, recently withdrew plans for a $1.2 billion facility in Sydney’s Lane Cove after intense community opposition. Tasmanians are fighting developments by IPO hopeful Firmus, while a $10 billion data centre in South Australia proposed by Nasdaq-listed Iren also faces local concerns. Victoria’s Labor Premier Ben Carroll has responded by banning data centres near sensitive sites, influenced by residents near NextDC’s West Footscray facility. NextDC operates a network of premium data centres, providing essential infrastructure for cloud computing and AI.
Investment managers warn this “social backlash” poses a genuine risk for data centre valuations. Cyan Investment Management’s Dean Fergie notes growth expectations are already priced in, making regulatory or supply chain hurdles impactful. While structural demand for AI and cloud computing remains robust, experts highlight community acceptance, power access, planning approvals, and water as critical constraints. Companies with existing access to these necessities are better positioned, whereas new projects facing opposition could experience longer lead times and higher costs, challenging the industry’s rapid expansion.
