AI data centre boom threatens to delay Australian projects

Summarised from 2 outlets · Updated 4 Nov, 17:11 · Archive

Record investment in AI data centres is outpacing the mining boom and threatening projects across Australia.

Australia's data centre construction projects are set to reach $870 billion in 2027, more than double the peak of the mining boom in the 2000s, according to Deloitte analysis. The report warns the rampant investment has come at a time when the economy has little spare capacity to accommodate such an increase in demand.

Sheraan Underwood, the report's lead author, said that data centres are competing directly with housing and infrastructure for workers and materials. Labour is the main constraint, with competition for these workers expected to add to costs and raise the risk that projects are delayed, scaled back or take longer to deliver. Investment is concentrated in NSW, Queensland and Victoria, meaning less populous states are missing out, unlike the mining boom which directed the majority of funds to resource-heavy states.

The construction and inflation pressures are arriving now, while the productivity gains may take much longer to emerge. Underwood noted that the dividend was based on a 'narrow base' of data centres, infrastructure and the net zero transition. Inflation remains above the Reserve Bank's target and the construction sector is already dealing with a historically large volume of work.

How it is being reported

• Scant capacity as data centres add to crowded pipelineRecord investment in AI data centres is outpacing the mining boom of the 2000s and threatening to slow down, delay or scale back projects across Australia.The West Australian · 4 Nov, 16:34
• Scant capacity as data centres add to crowded pipelineRecord investment in AI data centres is outpacing the mining boom of the 2000s and threatening to slow down, delay or scale back projects across Australia.Perth Now · 4 Nov, 16:34

In this story: Australia · Deloitte · Sheraan Underwood · NSW · Queensland · Victoria · Reserve Bank

This summary was written by AI from the headlines and standfirsts above, and states as fact only what at least two outlets report. How we use AI · Report a problem · Corrections log