Datagrid to Build NZ$3.5 Billion AI Data Centre

Datagrid, a Singapore-based company, has secured approval to construct a NZ$3.5 billion AI data centre campus near Invercargill, New Zealand. Scheduled to open in 2028, the 280 megawatt facility is expected to more than double the country's total data processing capacity and become the second-largest electricity user in the nation, trailing only the Tiwai Point aluminium smelter.

To manage energy requirements, the company has entered a power purchase agreement with Mercury for 140MW of its projected demand. While critics and the Green Party have raised concerns regarding grid pressure—leading to a proposal for a one-year pause on new AI data centres to establish stronger regulations—experts argue that such facilities can stabilize the system. They suggest that battery and UPS infrastructure allow these centres to absorb surplus renewable energy and act as grid assets.

Government bodies and operators have highlighted the potential for flexible electricity demand to reduce future network investment. Specifically, Transportation Power, Inc. estimates that reducing peak demand by one gigawatt could avoid NZ$1.5 billion in system costs.