There is an important dimension largely absent from NSW's current proposals for data centre electricity connection and cost recovery, being the rights, interests, cultural and Country responsibilities, and economic opportunities of First Nations people.
The First Nations Clean Energy Network has provided a submission based on Member feedback to the NSW government's consultation on Reforming electricity network connection and cost recovery arrangements for data centres in NSW.
On the proposed reforms, the Network wrote we broadly support their direction.
However, we note data centres should not be considered only as buildings connected to an electricity network. Their impacts extend across the infrastructure systems required to service them: renewable generation and storage, transmission and distribution infrastructure, water, land and associated infrastructure.
This infrastructure will be developed on First Nations Country, including in areas where First Nations people hold legally recognised rights and interests, and much of the associated generation, storage and transmission infrastructure is likely to be located in regional NSW.
The Network therefore recommends that NSW apply the same system-wide approach it is adopting to electricity infrastructure to First Nations rights, interests and economic participation.
This should have two complementary objectives.
First, data centre development must respect First Nations self-determination and ensure that Traditional Owners have genuine choice and agency over development affecting their Country, culture, heritage, water and environment, including through processes consistent with FPIC.
Second, the extraordinary investment in new electricity supply driven by data centres should be deliberately used to create opportunities for First Nations ownership and economic participation, including by creating demand for First Nations-owned clean energy.
Our recommendations
- Recognise the whole infrastructure footprint of data centres, including generation, storage, transmission, distribution and water infrastructure, when considering First Nations rights, interests, impacts and opportunities.
- Embed First Nations self-determination, choice, agency and Free, Prior and Informed Consent (FPIC) into relevant data centre planning, network access and associated infrastructure processes, with engagement occurring while material decisions about location, scale, design and conditions remain open.
- Apply established First Nations best-practice principles and leading-practice guidance to data centre development and associated infrastructure, rather than developing a weaker or separate standard for data centres.
- Require and resource meaningful First Nations participation. Data centre proponents should provide appropriate resources to affected First Nations communities and groups to participate throughout project development, assessment and implementation, including funding for independent legal, technical, commercial, cultural heritage and other advice where required. Engagement timeframes should accommodate First Nations governance and decision-making processes rather than being dictated solely by proponents' development schedules.
- Require responsible and transparent water use. Data centre proponents should be required to disclose and minimise water consumption, identify the source and infrastructure required to supply water, and assess cumulative impacts on water systems and First Nations Country, rights and cultural values. Affected First Nations people should be engaged and appropriately resourced to participate in decisions about water use and associated infrastructure.
- Establish a First Nations clean-energy procurement requirement within requirements for data centres to procure additional renewable energy and firming, initially through an obligation to identify and genuinely test opportunities to procure from, contract with or invest in First Nations-owned and controlled projects.
- Develop measurable First Nations procurement and ownership targets for data centre energy procurement as the First Nations clean-energy project pipeline develops.
- Include First Nations outcomes as explicit merit criteria in any large load access scheme, including First Nations clean-energy procurement, ownership and equity, protection of Country and culture, First Nations business procurement, employment and training, and benefit sharing.
- Require transparent reporting of First Nations outcomes associated with major data centre developments and the energy infrastructure that services them.
- Engage and appropriately resource First Nations organisations to participate in developing the proposed large load access scheme and subsequent data centre regulatory reforms.
Read our submission