Parliament of Victoria | Legislative Council | Motions
4 March 2026
David ETTERSHANK (Western Metropolitan Region):
I move:
That this house:
(1) notes that:
(a) the recent announcement of the government’s intention to ruthlessly attract more data centres to Victoria has raised concerns about the strain this will place on the state’s energy system and water resources;
(b) the government is fast-tracking planning approval for data centres with little or no sustainability or planning policies in place for them;
(c) local councils are seeing data centre companies seeking ministerial approval in order to bypass local council approval;
(d) on 17 February 2026, the Minister for Water stated that: ‘An expert review is being undertaken by DEECA’ (Department of Energy, Environment and Climate Action) ‘with VicWater, the industry peak body, to ensure existing water-use policies for large industrial users, including data centres, keep pace with this rapidly emerging sector’;
(2) requires the Leader of the Government, in accordance with standing order 10.01, to table in the Council, within 30 days of the house agreeing to this resolution, documents relating to the expert review, including:
(a) correspondence from the relevant minister to DEECA and VicWater instructing these agencies to undertake the review;
(b) the terms of reference for the review;
(c) any interim reports; and
(d) the reporting date for the final report of the review.
I rise to speak on our documents motion regarding data centres. Victoria currently has over 40 centres, and we have been bombarded with breathless media releases about this government’s ambition to host many, many more to position Victoria as the AI and data centre capital of Australia. The Premier has vowed to ruthlessly pursue investment with the promise of available land close to the city, serviced with water and power, all ready to be repurposed for the burgeoning industry.
We are told these facilities will provide thousands of jobs and unlock billions in potential capital expenditure. While the economic benefits, which are questionable at best, are relentlessly spruiked by the government, the legitimate and growing concern around data centres’ voracious energy and water consumption are not being addressed.
There appear to be few guidelines on energy procurement, water use or location, and questions around who will ultimately bear the financial and environmental cost of these centres are left unanswered.
Last year the government announced a sustainable data centre action plan, with details to be released within weeks. But the release date for this plan is yet to be announced. There are no details of what it entails, but the plan continues to pop up in government statements.
The recently released Victoria: AI-Driven, Business-Ready – the Victorian Government’s AI Mission Statement trotted out the same quote – Labor’s $5.5 million sustainable data action plan is positioning the state as a ‘national leader’ in sustainable data centre investment. The mission statement uses the word ‘sustainability’ a few times in a sort of aspirational, nice-to-have kind of a way, but it is far more about attracting investment than explaining how this vision will actually impact upon Victorian communities. It reads:
‘Data centres, like all major infrastructure, need energy, water, planning and land allocation.’
But data centres are not like other major infrastructure when it comes to energy and water use. By way of example, Greater Western Water is currently reviewing 19 applications for data centres – and that is only a small cross-section of those that are currently being applied for – which will consume nearly 20 megalitres of drinking water each year.
That is the equivalent of around 4 per cent of Melbourne’s total drinking water – or to put it another way, it is equivalent to filling up eight Olympic swimming pools every year.
The Australian Energy Market Operator also estimates that data centres will use 19 per cent of Melbourne’s electricity grid by 2050. But the Minister for Economic Growth and Jobs Danny Pearson seemed quite blase about sustainability, telling the Australian Financial Review:
‘You put AI on a leash and you let it run … If it starts to get away from you …then you look at trying to say ‘we need to intervene …’
So apparently the plan is to wait for the horse to bolt and then think about shutting the gate. In the US and Europe data centres are already competing with agriculture and residential consumption. The establishment of data centres in Europe threatens to up-end the EU climate law, which requires a reduction of net greenhouse gas emissions by at least 55 per cent by 2030 compared to 1990 levels.
Similarly, communities across the world are grappling with the strain placed on electricity networks by these energy-intensive facilities, and we face the same issues. With below average rainfall and water storage capacity falling, Victoria is on track to begin water restrictions by the end of the year. Will data centres face those same restrictions – 55 litres a day, perhaps?
Minister Tierney recently stated that an expert review is being undertaken by the Department of Energy, Environment and Climate Action with VicWater, the industry peak body, to ensure existing water use policies for large industrial users, including data centres, keep pace with this rapidly emerging sector. We welcome that.
We are requesting documents relating to this review, including correspondence from the relevant minister to DEECA and VicWater instructing these agencies to undertake the review, the terms of reference for the review, any interim reports and the reporting date for the final report of the review.
These facilities are being fast-tracked for planning approval. We have a right to know what the Victorian government is doing to protect our water and energy needs, now and into the future. We are not asking to turn back time. These are important economic initiatives, but we know data centres and AI are here to stay, and we also know that the sector must be regulated.
We need to mandate the use of recycled water and sustainable energy, and these regulations should be in place before these data facilities are approved and built. And we need assurances that the multinational companies building these hugely profitable facilities are footing the bill, not the Victorian public.
So we are keen to understand what the DEECA–VicWater expert review is doing, how it is doing it and when we will get the results. I commend the motion to the house.
[Motion agreed to]
