The Victorian government has unveiled what it calls the “strongest, clearest data centre rules in the country”, including a ban on facilities being built within 150m of homes, schools and childcare centres, and a requirement to generate renewable energy.
But for residents of Spotswood, where a $1.47 billion, 240MW data centre has been proposed, the new protections may have come too late.
Sydney-based technology company Greensquare, which was acquired by a Swiss private equity firm last year, applied to build the facility through the Victorian government's fast-track planning process.
The proposed site in the small suburb, about 7km south-west of Melbourne's CBD, is as close as 100m to residential areas and a childcare centre.
Under the newly announced rules, the proposal would likely be rejected. However, the changes will not apply retrospectively, meaning applications already lodged can proceed under the existing arrangements.
That leaves the Spotswood proposal potentially unaffected by the new protections.
For long-time residents Peter and Laura Russel, who have been campaigning against the development, this is difficult to accept.
They believe approvals for data centres should be put on hold until the new rules take effect.
“If the government now says data centres should be kept away from homes and childcare centres, what happens to the new Greensquare proposal?” Laura told Information Age.
“I’ll be furious if Greensquare is approved before these new protections come in. If the government believes these rules are necessary, why wait until 2027?”
However, the campaigners may have secured a victory, with reports that Greensquare withdrew its Spotswood proposal.
The public consultation process is expected to be reset if, or when, the application is resubmitted.
The rumours
For the Spotswood residents, the campaign began with a rumour circulating on a local community Facebook page.
Residents had started hearing whispers that a large data centre was being planned for their small Melbourne suburb.
A page on Greensquare's website detailing a planning application for the facility was subsequently shared in the group.
For many, it was the first they had heard of plans for a $1.47 billion, 240MW data centre in their neighbourhood.
The community has since rallied in opposition, raising concerns about the facility's proximity to homes and childcare centres, its enormous electricity requirements, noise and environmental impacts.
Spotswood has become another flashpoint in the growing community opposition to data centre developments, as state governments move to fast-track projects and capitalise on the significant economic opportunities they promise.
The dispute highlights the challenge facing governments as they attempt to balance the economic benefits of data centre investment against the environmental and community impacts.
‘Flat out do not want this’
Greensquare initially submitted its data centre application to the local council before withdrawing it and later resubmitting it through the Victorian government's fast-track planning approval process.
The process removes the council from the decision-making process and eliminates the ability to challenge a planning decision through the Victorian Civil and Administrative Tribunal (VCAT).
In its application, Greensquare described the facility as “critical digital infrastructure in a highly suitable industrial location” that would “not result in material detriment to any person.”
It argued the development “will deliver significant economic, infrastructure and public realm benefits through the redevelopment of a large, long-vacant and underutilised industrial site for critical digital infrastructure within the Spotswood Industrial Precinct.”
Greensquare's proposed Spotswood data centre would be built in stages. Source: Greensquare
The company estimated the completed facility would create 130 ongoing direct jobs.
It also outlined plans to reduce water consumption and use renewable energy, including renewable HVO diesel and battery backup systems to reduce reliance on fossil fuels.
“These measures represent a shift in how data centres can support growth in the state’s digital economy while aligning with broader objectives for a low-carbon, resource-efficient future,” the application says.
Local residents have called on the Victorian government to slow the approval process, properly consult the community and address their concerns.
“We think the majority flat out do not want this,” Peter told Information Age.
“The government needs to start listening to the community response to proposals such as this one.
“There is a lot of anger across the state about these projects, and the government does not appear to care at all.
“Because the government is not listening and taking appropriate action, this has become an election issue.
“They are not reading the room.”
In a statement provided to the Herald Sun, Greensquare said it had “engaged proactively and openly with the local community” from the outset.
The company said it had distributed letters to more than 600 households and businesses in mid-July and held community information sessions.
The Russells attended one of the sessions, which they said was “framed very positively”, with answers that were “deliberately vague” and used “imprecise language and misleading graphics”.
They also said a public relations agency had been employed to speak with residents attending the session.
Attendees could register to receive further information about the development, but Laura said they had received only one email since, containing the same information presented at the meeting.
Greensquare also said its leadership team had met individually with several members of the local community.
Its website features a frequently asked questions page about the Spotswood proposal.
“We understand the community will have questions about what this proposal means for the local area,” the website says.
“This is the beginning of our engagement with the Spotswood community.
“We are committed to listening to feedback, sharing information openly and providing opportunities for people to ask questions throughout planning, approvals, construction and operation.”
Greensquare has since published additional information about the development on its website, while nearby residents have also received formal notice of the planning application.
Local backlash
Spotswood is not the first Melbourne suburb where a proposed data centre has triggered significant community opposition.
Plans for a $1.1 billion data centre in Campbellfield are also progressing through the Victorian government's fast-track planning process.
That proposal has prompted similar concerns about proximity to homes, environmental impacts and the relatively small number of jobs expected to be created.
Greensquare has also faced opposition elsewhere, having abandoned plans for a $1.1 billion data centre in Western Australia earlier this year following sustained community backlash.
In that case, the proposal went through the local council, which recommended it be rejected over noise concerns.
Last month, the Spotswood residents wrote to several Victorian government representatives outlining their concerns about the lack of appeal rights, uncertainty around the scope of the development, environmental impacts and its proposed location approximately 100m from homes and childcare facilities.
“The proximity of this proposed facility to residences and childcare facilities make this an extremely urgent concern, which is magnified by the risk it would appear to present to the Westgate Bridge itself,” the letter said.
“The only balance offered for these many and significant negative impacts are speculative jobs without any guarantees or numbers offered regarding actual location in Spotswood.
“Data centres such as this are not known for creating much long-term employment on site; these vague suggestions cannot be taken seriously as a trade-off for the negative impacts.”
The group said its correspondence had largely resulted in automated replies or responses containing “platitudes” that failed to address its concerns.
Laura stressed that she was not opposed to data centres in principle, but believed stronger regulation and meaningful consultation with affected communities were needed.
“We are aware that this is part of the modern world and that data centres will be constructed,” she told Information Age.
“We simply feel that there should be stringent and clear regulations before any approvals or constructions are permitted, and those regulations should include requirements that these centres are nowhere near residential, educational or community recreational spaces.”
The balancing act
Australia has become the world's largest data centre market, with state governments competing to attract investment through fast-tracked approval processes.
But the industry's expansion has been accompanied by growing community opposition, particularly over the environmental impact and enormous energy requirements of these facilities.
A recent Greenpeace Australia report described data centres as “energy vampires” and called for a pause on new construction until appropriate regulations are introduced.
It argued that the facilities could derail Australia's energy transition.
The federal government has also been developing national data centre energy requirements, initially proposing that operators generate more electricity from renewable sources, backed by gas, than their facilities consume from the grid.
However, it subsequently backed away from forcing Queensland and the Northern Territory to mandate renewable energy requirements.
For the Spotswood residents, Victoria's newly announced rules offer some hope that the state government will take a stronger approach to future developments.
But they want action before more projects receive approval.
“There shouldn’t be any more approvals until these are in place,” Peter said.
