‘I’d love to see more of it’: Telstra backs data centre boom amid backlash

Telstra says Australia has a natural advantage in the global race to build artificial intelligence data centres, and wants to see more of them built here despite growing community backlash.

Nathan Gumley, the telco’s executive for software engineering and IT, said the country’s combination of renewable energy and water set it apart from much of the United States, where developers are often forced to choose between the two.

“If you look here in the US, you can go where power is cheap because renewables exist, but there’s no water,” Gumley said in an interview at Salesforce’s Dreamforce conference in San Francisco. “Or you can go where water exists and there’s no renewables and power’s really expensive.”

Large data centres use significant volumes of water for cooling, and electricity costs are among the biggest determinants of whether a site is commercially viable. Gumley, who has spent time working on renewables for Telstra, said that cost profile made Australia ideal for an accelerated data centre build-out.

“I think it’s a very natural competitive advantage for Australia,” he said. “With the right settings and the right partnerships, huge potential.”

The debate over whether Australia should be courting the build is reaching fever pitch, with Anthropic signing its first Australian data centre lease on Wednesday . It’s taking the entire capacity of a proposed $32 billion development in Queensland’s Western Downs, about 250 kilometres north-west of Brisbane. Premier David Crisafulli called it a major win for the state.

Queensland secured an exemption from the federal requirement that AI data centres be fuelled exclusively by new renewable energy . Planning documents for the site say the first stage could be powered by gas, with three major gas power plants within two kilometres.

Treasury has estimated $150 billion could be spent on Australian data centres by 2030. There are 162 already operating and about 130 more at the planning stage.

Community resistance is building alongside the investment. Residents are campaigning against a $1.47 billion facility proposed for Spotswood in Melbourne’s inner west , which would draw 240 megawatts, roughly the consumption of 250,000 Victorian households.

In the United States, 18 states have passed moratoriums on new data centres.

The company stands to benefit directly from any expansion of the build. It is constructing the Aura Network, a terrestrial fibre network connecting Australian capital cities, and has deployed more than 8500 kilometres of fibre with six routes ready for service. It owns or operates about 400,000 kilometres of subsea cable.

“We’re just incredibly well-placed to be able to connect to those things, particularly with intercity network,” Gumley said. “I’d love to see more of it.”

Telstra has signed long-term contracts across its fibre and subsea assets with Google, Amazon Web Services and Australian AI infrastructure company Firmus.