Submission to NSW Department of Climate Change, Energy, the Environment and Water on Reforming electricity network connection and cost recovery arrangements for data centres in NSW

Data centres have become an obvious community concern. Experience in other countries has not been positive, and the risk to Australian energy consumers is real. 

As Australia has been identified as a destination of choice, and an already growing pipeline of proposed investments, data centres must be carefully managed to ensure they add value to the network for consumers.

Our submission recommends that NSW DCCEEW develop data centre regulation in accordance with the following principles:

1. Any energy bill increase attributable to data centres must be offset by them
2. Data centres must pay for the network costs incurred by their connection and network augmentation needs
3. Data centres must rely on new, additional, renewable generation capacity
4. Strong energy efficiency requirements must be placed on data centres
5. Data centres must create net benefits for other consumers, notably by providing grid services

These principles can help to establish clear expectations that household and small business consumers be prioritised, while also addressing growing consumer concerns regarding energy prices, equity, and environmental impacts.