The Concerned Waterways Alliance has made a submission to the Australian Senate Environment and Communications References Committee inquiry into Artificial Intelligence and Data Centres.
CWA’s submission focuses on an issue that has received far less attention than the extraordinary energy requirements of hyperscale data centres: their demand for water, and what that demand could mean for already stressed rivers and household water bills.
Data centres are now an important part of modern economic and civic infrastructure. CWA does not oppose their development. Our concern is that the rapid emergence of hyperscale and AI-oriented facilities is exposing weaknesses in water planning, pricing and environmental safeguards that were never designed for industrial customers capable of seeking gigalitres of water each year.
The issue is particularly acute in Victoria, where many rivers are already highly flow-stressed and governments have committed to return more than 100 GL of environmental water under the Central and Gippsland Region Sustainable Water Strategy.
CWA argues that new data-centre demand must not delay, reduce or displace those environmental water commitments.
The submission also examines the cost implications for households. If hyperscale demand brings forward greater use of expensive desalinated water, recycled-water infrastructure or major network augmentation, those additional costs should be transparently identified and recovered from the industrial users creating them—not spread across ordinary water bills.
Recent policy developments show that governments are beginning to recognise the scale of the issue. In July, the Australian Government announced that its voluntary Data Centre Expectations would be developed into nationally consistent mandatory standards, and National Cabinet subsequently agreed that these should cover energy, water and land use. The NSW Government has also introduced detailed data-centre guidelines including water-efficiency standards, recycled-water requirements and a principle that data-centre growth should impose no net cost on consumers and communities.
CWA welcomes these developments, but argues that a national framework should go further.
Our submission calls for:
- a binding hierarchy that puts closed-loop and non-drinking water sources ahead of potable water;
- protection of environmental water recovery;
- publicly available Water Impact Assessments;
- facility-level disclosure of water use and efficiency;
- cumulative regional assessment and limits;
- dedicated tariffs or equivalent full-cost pricing mechanisms; and
- a national principle that households and ordinary businesses should not subsidise data-centre growth.
Australia can support AI and digital infrastructure without asking households or already stressed waterways to carry the cost.
Read CWA’s full submission to the Senate inquiry into Artificial Intelligence and Data Centres below.