Data centres

Data centres are critical infrastructure. They store and process the digital information behind everyday services like online banking, health records, streaming and government systems. 

As demand for AI, cloud computing and digital services grows, data centres are expanding rapidly across Sydney, particularly in Western Sydney. This growth is shaping infrastructure decisions that will support Sydney for decades. 

That’s why we are working closely with industry and the NSW Government to prepare for growth while protecting essential services for the community. 

Data centres use water differently to homes and most businesses. Some require large volumes in a small number of locations and need highly reliable, continuous supply. This concentrated demand is influencing how and where water is used across Sydney. 

Planning for this growth can be complex, but we are well equipped to manage it. We're working with industry and government to better understand demand and plan the infrastructure needed to support it.

This includes targeted upgrades and new infrastructure where needed, as well as recycled water to help meet demand and reduce reliance on drinking water where feasible.

Data centre development is emerging across Sydney. Some developments are concentrated in the same areas. We assess expected demand at individual sites, nearby groups of data centres and across the wider network. This helps us plan where we may need new or upgraded infrastructure.

We've set clear principles to guide how we support data centre growth while serving the community:

• Residential customers and existing users will not face higher costs or added supply risk.
• Very large water users pay charges that reflect the true cost of supply.
• We prioritise the use of recycled water to support greater resilience.
• Risks are shared fairly and managed by those best placed to manage them.
• Pricing helps manage long‑term demand and cost uncertainty while protecting affordability.

We're committed to ensuring residential customers will be no worse off and continue to have a safe, reliable and affordable water supply.

A key challenge in planning for data centre growth is uncertainty about future demand. We're managing this through flexible planning that can adapt as demand becomes clearer.

The infrastructure that supports data centres today also strengthens water security for all customers tomorrow. Using more recycled water makes better use of our natural resources, reduces our reliance on rainfall and helps keep water flowing during drought.

We prioritise recycled water where it is available and practical for data centres to use. When recycled water is not yet available, data centres may need to use drinking water as a temporary or backup supply.