Parliament of Victoria | Legislative Council | Constituency Questions
28 October 2025
David ETTERSHANK (Western Metropolitan Region):
My question is for the Minister for Water. While AI potentially brings great benefits, there are enormous environmental costs, in particular the water and energy required to run data centres.
The New York Times reported last week that a 100-megawatt data centre consumes roughly 2 million litres of drinking water per day. That is the equivalent of 6500 households.
And in western Melbourne, there are currently 19 data centre development applications. As the AI arms race heats up, community water supplies are being threatened.
There is currently no statewide policy about where the water for proposed data centres will come from and how they will impact already stressed reservoirs, waterways and wetlands.
Last week I met with groups connected to the Maribyrnong and Werribee rivers, which are already over-extracted and in ecological decline.
My constituents ask: will the minister meet with key stakeholders of the Urban Waterways Alliance to update them on how proposed data centres are likely to impact our already stressed waterways and rivers?
Written Answer
Received: 12 May 2026
Hon. Harriet Shing MP
(Minister for Water, Minister for Health, Minister for Ambulance Services)
I thank the member for Western Metropolitan Region for his question on data centre developments.
Victoria has strong controls in place to protect existing water users, the broader network and the environment.
Before providing approval for new applications, water corporations must be satisfied that water security and supply can be met, without negatively impacting communities and other users.
In December 2025, we released updated Urban Water Strategy Guidelines that provides guidance to water corporations to work with data centres to supply them with recycled water, instead of drinking water, wherever feasible.
I can also advise that DEECA is developing a statewide water forecast and adaptive framework to manage future water use by data centres.
DEECA is also undertaking mapping of recycled water availability, to inform sustainable data centre planning.
If additional capacity for water is needed, a new customer contribution charge is set by the Essential Services Commission (ESC) and charged by water corporations to the data centre developer.
To ensure transparency for water usage, any non-residential water user that uses over 100 megaliters a year, including data centres, will be publicly reported by their water corporation and identified if they are participating in a water conservation program.
DEECA is currently working with the water sector to ensure existing water use policies for large industrial users, including data centres, remain fit for purpose.
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