How much water and electricity will AI data centers use in Australia? Ironically, we don’t have the data to know this

How much water and electricity will AI data centers use in Australia? Ironically, we don’t have the data to know this

By Michael Vardon
Publication Date: 2026-06-03 03:54:00

The rush for data centers in Australia now rivals the mining boom. OpenAI CEO Sam Altman said last week Australia could become the “data center capital of the world”.

This would entail costs for the environment. Water consumption is a common problem. One report estimates that AI centers could use billions of liters of water annually.

But what do the numbers say? Based on the value determined per megaliter, data centers appear less threatening and more likely to have highly economically productive use of water.

The bigger issues are energy and location. Data center power demand could exceed clean electricity from renewables and lead to new gas-fired power plants, a new report suggests.

Before we fully commit, we need detailed information about how much water and energy these centers use.

In cities like Sydney, new data centers are being built or planned at record speed.
Mick Tsikas/AAP

What value do we get…