Chlöe Swarbrick discusses new AI data centre policy

The Greens are calling for a one-year pause on consenting for new AI data centres so rules and regulations can be put in place.

Data Grid has consent to build a data centre in Southland. Once it's up and running, it will be the second-largest electricity user in the country and have permission to draw more than 600,000 litres of groundwater each day.

The policy came out of the Green Party AGM over the weekend. They also launched the official campaign slogan, 'For all of us.'

Greens co-leader Chlöe Swarbrick said on Monday they were hearing "real concern from communities, including those in Southland, who have had this Data Grid centre consented behind closed doors".

"If we look at the experience overseas, you cannot put this genie back in the bottle. And the impacts on the energy grid - particularly actually just to take the instance of that Data Grid centre, we're talking about 6 percent of our current energy or electricity produced in this country… that is a town the size of Hamilton coming on effectively overnight, which will drive up the cost of electricity for every other New Zealander and risk actually displacing costs onto other industries and therefore potentially cost jobs.

"We've also seen the impact on local water supplies and other jurisdictions where fresh water has turned effectively into sludge - or sedimentary water, as some others may prefer that I characterise it as. But at the end of the day, we haven't had a national conversation about whether we actually want things, and I think that New Zealanders deserve that."

Data Grid has said the water they use to cool the computers in the data centre will be 'closed loop' and not contaminate anything.

Prime Minister Christopher Luxon (National) at the weekend called the Greens' views "alarmist", despite Swarbrick saying he actually "agreed with all of the things that we were saying about the impacts on communities, on energy, and on the local water supply".

"But he's actually not willing to do anything about the regulation. We cannot put this genie back in the bottle if we end up consenting these things as they currently are allowed to be on a non-notified basis without any meaningful community input.

"We are likely to see exactly what has happened around the rest of the world, where there is massive detrimental impact on local resource and local people for not all too much benefit. So I just don't really get the argument that we should be rushing ahead to invite these things when we don't actually know what the cost-benefit analysis is. This is just straightforward common sense."

She feared changes to the law will make it easier for future data centres get approval.

As for jobs, Data Grid said 12 00 jobs would be created during the construction of the centre. Gentailier Mercury, which has invested $53 million into Data Grid, said once the centre was built it would support up to 300 jobs "multiplied by the jobs that will be used to construct the power stations necessary for the electricity", according to CEO Stu Hamilton.

He said it was a "significant construction job, and actually it could be bigger than the CRL in Auckland". The company building it was New Zealand-owned, paying taxes here, and would have a "flow-on effect to numerous companies that are providing services to the centre as well".

"It's a good project for New Zealand because fundamentally… One of those areas that we do really well in is producing energy, particularly renewable energy. And so if we can look at that [advantageous] position we have with energy, and we look at the security that New Zealand has, we have the capability to build things like data centres that support New Zealand's growth."

Swarbrick pointed to recent closures of paper mills and factories, with hundreds of jobs lost in each, due to high power prices.

"Plugging in effectively an entire new city's worth of power demand without any requirement of new power generation does run the risk of pushing up those prices further and displacing local industry, hollowing out our ability to make things, and killing hundreds of local jobs."

Hamilton said it was possible to both build power-hungry data centres and have lower electricity prices.

"If you look at the amount of power we've been building over the last few years, we're building at a rate that's 25 percent faster than New Zealand was building during the 'Think Big' period, and that's all coming from private money."

Mercury CEO discusses investment in new major data centre

He admitted growth in power generation had slowed over the last 10 years, and the drying up of gas fields had contributed to that.

"And so about five years ago when we started to see that happen, we started to actually turn on the button to ensure that we could actually build new power projects. It takes a little bit of time, like most infrastructure does.

"But if you look at the infrastructure sectors in New Zealand at the moment, I'd say that the power industry is probably building at a rate that's faster than any other infrastructure sector. And so we can be proving that we're doing that now, and we're seeing the benefits of that flow through."

He said Mercury wanted to ensure when data centres came online in New Zealand, additional power generation would too.

"If you look at water, these are the issues that also should be explored. The new technology is much, much better in terms of how that manages the impacts on the local community, and I'd say that they're all big issues that should be discussed."

As for lower electricity prices, Hamilton said the best fix was to build more generation - but would not commit to bring retail prices down - just having increases "closer to CPI (consumer price index), slightly above CPI".

"You'll see it start to smooth out, absolutely."