AI data centres drive fossil fuel emissions, higher power bills

New South Wales faces rising fossil fuel emissions and power bills due to 90 approved AI data centers, with 22 more under review, as experts warn of unchecked energy demand and greenwashing by tech firms. Analysts say data centers will consume 11% of the state’s electricity and 20% of Sydney’s water within a decade, while renewable energy claims by companies like Amazon are misleading." "article": "New South Wales is accelerating approvals for AI data centers, with 90 already approved and 22 more large-scale projects under consideration by the state government. Abigail Boyd, chair of the NSW Parliamentary Inquiry into data centers, warned that corporate owners should be treated as an extractive industry due to their high energy and water consumption, which undermines decarbonization efforts. The rapid expansion of data centers is increasing demand for fossil fuel-generated power, driving up greenhouse gas emissions and electricity prices. Ketan Joshi, a climate and energy analyst, noted that even when data centers use renewable energy, overall grid demand rises, incentivizing more coal and gas use. Boyd highlighted that most data centers avoid contributing to grid upgrades, shifting costs onto consumers. One planned facility in NSW, operated by Cloud Carrier, seeks to build a 700-megawatt gas-fired power station—equivalent in size to the Kurri Kurri plant. By 2030, data centers could consume 11% of the state’s electricity and 20% of Sydney’s water, with the Marsden Park Data Centre alone using as much power as 140,000 homes. Tech firms like Amazon are using renewable energy credits to claim sustainability, but critics say these efforts are often misleading. Amazon’s recent power-purchasing deals included a 2022 wind farm in Victoria, which the company now counts toward its 2026 emissions claims. Joshi argued that such practices overstate progress while increasing overall energy demand, worsening grid reliance on fossil fuels. Despite some renewable energy integration, data centers primarily depend on diesel or gas-powered on-site generation. Boyd and Joshi emphasized the need for long-term planning to prevent unchecked growth, warning that current project-by-project approvals lack oversight. Without regulation, the environmental and financial costs of AI infrastructure will continue to rise.