‘Reluctant’ approval for Tasmanian datacentre sets marker for national battle

Concerns over planning process as George Town council gives go-ahead for 288MW AI factory despite opposition from locals

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The day before Anthony Albanese secured agreement with states and territories to develop national datacentre standards , a small council in Tasmania was grappling with the existing regulations in the face of strong community opposition to a new AI factory planned for its town.

The George Town council voted 6-1 to approve the plans of Australian developer Firmus to build a 288 megawatt (MW) datacentre at Long Reach, north of Launceston, but said it did so reluctantly.

The AI factory is planned on the former Gunns Pulp Mill site near the Tamar River, and has faced strong opposition from locals. A petition calling to stop the centre going ahead had nearly 6,000 signatures. More than 300 people wrote submissions on the application to the council.

Many of the submissions raised concerns about energy use, concerns about AI, or pointed to “commonwealth regulation”, according to the council’s agenda document, which said those concerns were “outside the scope” of the council’s role in deciding the application.

At the heated meeting to decide the centre’s fate on Tuesday, speakers lined up to express their objections to the proposal, with many saying the council should be waiting until new federal rules are in place.

Lorraine, one local who spoke at the meeting, pointed to the prime minister’s plans and said the council’s approval should wait.

“Last week on national TV, prime minister Anthony Albanese announced a landmark policy setting out new mandatory standards for large-scale AI datacentres to be built,” she said.

“Tasmania is part of Australia, and we deserve to be protected too,” she said.

On Wednesday, Albanese announced after national cabinet that the government would legislate from early next year a nationally consistent regulatory framework setting minimum requirements for large datacentres.

The federal government plans to work with states and territories on consistent mandatory standards on energy, water and land use, but the communique out of national cabinet stated that the legislation “will be designed to complement, not duplicate” state and territory planning and approval processes.

In George Town, councillors said they had to apply the law as it is today, not waiting for the future rules to come into effect.

“This is probably one of my hardest decisions while I’ve been on council in the last four years,” councillor Heather Ashley said.

“We’ve talked about this a lot … but as a planning authority, we have guidelines and we can’t go over those guidelines.”

Each councillor had been “very reluctant” to make the decision on Tuesday, councillor Winston Mason said.

“But as has been said a hundred times, it’s a decision that we have to make under planning rules and regulations. So that’s it.”

People who raised objections to the proposal will have 14 days from Tuesday to appeal against the decision. Anne-Marie Bastian, who began the Change.org petition against the datacentre, said it was likely to be appealed by multiple residents.

“There’s plenty in the community that are pissed off right now,” she told Guardian Australia. “Their concerns were totally dismissed.”

A spokesperson for Firmus welcomed the council’s decision, and said the project would now progress through design, procurement and construction planning.

The Firmus co-founder Oliver Curtis said the company supported the national expectations for datacentres and the standards behind them.

“Operators should be able to demonstrate how they are supporting the energy system, using water responsibly, choosing appropriate locations and delivering real benefits to the communities that host them,” he said.

“Our AI factories are purpose-built and holistically designed to improve energy efficiency and minimise water use.”

Ahead of the new rules being legislated, there is a steady stream of datacentre plans coming in to state and territory authorities for review. The Australian Energy Market Operator said in its report this week that there were 225 datacentres in development across the country.

The Greens senator and chair of the federal parliament’s datacentres inquiry, Sarah Hanson-Young, said there should be a moratorium on new AI datacentres until the rules are in place.

“These companies are already bulls at a gate, pushing state governments to give them approval,” she said.

“They’re already railroading communities across the country … [We need] either a moratorium or the laws are going to have to be retrospective.”

While the rules may be tighter under the federal plan, some are running into hurdles under the existing regime. Victoria’s Environment Protection Authority this week issued its first ever objection to a datacentre in the state, in opposing the application by Zerra DC to turn the former Ford factory at Campbellfield in Melbourne’s north into a $1.1bn, 366MW datacentre campus.

A spokesperson for the EPA noted it was ultimately for the minister for planning to make a decision, but EPA Victoria objected over “concerns over potential noise risks and the cumulative impacts associated with the overall site layout and development”.

The EPA said if an amended or new application is lodged, then it would be reassessed.

A Zerra DC spokesperson said the company welcomed the feedback and was working through it with specialist acoustic consultants.