NSW Inquiry Warns AI Data Centres May Hike Energy Costs

A government inquiry in New South Wales warns that the proliferation of AI-driven data centres threatens to overload power grids and raise energy costs for Australian households and businesses. More than 90 data centres have been established in the state by operators including Microsoft, Amazon, AirTrunk, and NextDC to meet increasing artificial intelligence demands.

Energy Minister Penny Sharpe asserted that data centre operators must bear the full cost of infrastructure and connection. Sharpe stated that if companies want data centres, they must pay for the overall costs so that consumers do not bear increased expenses.

The inquiry is evaluating regulations for energy use, transparent reporting, and a potential mandate for battery backups to replace diesel generators. Officials noted international precedents in Virginia, where school districts reportedly asked teachers to keep lights off to conserve electricity. Findings from the inquiry are expected by September 30.