The artificial intelligence boom is driving a global expansion in data centres – and with it, public debate over their heavy demand for power, water and land.

Increasingly, governments are weighing their economic benefits against concerns about pressure on electricity grids, local communities and the environment.

That debate has now reached Aotearoa New Zealand. Singapore-based Datagrid has secured approval for a NZ$3.5 billion, 280 megawatt (MW) AI data centre near Invercargill.

Scheduled to open in 2028, it will become the country’s second-largest electricity user after the Tiwai Point aluminium smelter.

While Datagrid’s “AI factory” is expected to more than double the country’s data processing capacity, it has drawn some public unease. The Green Party recently proposed a one-year pause on new AI data centres while stronger rules are developed.

Similar regulatory debates are playing out overseas in places such as New York, Amsterdam and Australia.

In Ireland – now a global hub for AI infrastructure – data centres accounted for nearly a quarter of the country’s metered electricity consumption last year, forcing difficult questions about its future grid capacity.

That’s particularly relevant to New Zealand, where electricity shortages can already emerge during dry years when hydro lake levels are low.

But do data centres........

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