Australia has emerged as a global hotspot for data centre growth, driven by the surge in dependence on artificial intelligence.
The country’s strong appetite for AI, geographical position within the Asia-Pacific region, stable regulatory environment, ample land and renewable energy potential are among the reasons investors are homing in.
Data centres are not only crucial for AI but also power modern life, including streaming services and cloud storage.
But there are concerns that finding locations for this energy- and water-intensive infrastructure, which operates 24 hours a day, will become increasingly challenging in a world affected by climate change.
As data centres rapidly come online to meet demand, governments are being urged to ensure that development does not outpace adequate planning.
Data centres in high-risk areas
XDI, a company that analyses the physical risk of climate change, examined almost 2,600 planned data centres worldwide, revealing that some of the fastest-growing digital infrastructure hubs had emerged as climate-risk hotspots.
The analysis found 154, or 6 per cent, of the data centres examined were vulnerable to physical damage or operational disruption due to climate change.
South-East Asia was the most vulnerable, with 20 per cent of data centres already deemed high risk, a number expected to at least triple by the end of the century.
XDI director of science and technology Karl Mallon said much of the debate around data centre development had focused on energy demand and water consumption.
“But physical climate risk is becoming an increasingly important consideration in its own right,” he said.
“The question is no longer simply where the next generation of digital infrastructure gets built, but whether those assets can remain operational, insurable and economically resilient over their intended life.”