$840m desal expansion tipped as Melbourne faces AI water drain
Rainfall shortages and thirsty data centres have the government looking for long-term answers.
A drying climate and a boom in thirsty data centres could force an $840 million expansion of Victoria’s desalination plant to begin within five years, as the Allan government looks to secure the state’s water supply.
A report this week by Oxford Economics Australia tipped that work to upgrade the state’s Wonthaggi facility would start by 2030 and finish by 2034, adding 50 gigalitres of production to Melbourne’s system.
Victoria’s Wonthaggi desalination plant.Credit: Joe Armao
The expansion is part of a forecast building boom of 11 desalination projects around the country, aimed at meeting growing demand for water that does not rely on rainfall.
Although the Allan government has not committed to an upgrade of the facility, it is one of the options being considered by a water security taskforce which has been asked to find long-term supply solutions.
The taskforce will also consider building a second facility in the city’s west. The government has warned that demand means the state could face water shortages even if the current desalination plant runs at full capacity every year.
The Oxford Economics report notes that the construction of data centres presents a “significant upside risk for urban water use” and could rapidly increase demand in Sydney and Melbourne, partly driving renewed interest in desalination among water authorities.
Data centres can require huge amounts of water to cool their servers.Credit: Getty Images
Most data centres, driven by the rapid expansion of artificial intelligence and cloud computing, require massive volumes of water to cool their servers.
“That the biggest proportional increases in demand are taking place in cities, especially at risk of damaging water shortages, presents an additional challenge for water authorities in these cities: how to meet rapidly growing demand while minimising the risks posed by declining and sporadic rainfall,” the report said.
In NSW, officials are already bracing for data centres to potentially consume “as much as 25 per cent of water use” by 2035.
In July, Greater Western Water revealed it was assessing 19 applications for centres that would have used as much water a year as 330,000 Melburnians.