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Supporting growth while protecting water security

Demand for digital services is increasing as our communities grow.

Data centres have become critical infrastructure. They support everything from online banking and health services to artificial intelligence, cloud computing and everyday internet use.

At the same time, climate change is placing pressure on water supplies. Any new infrastructure must support growing demand while maintaining safe and reliable water and sewerage services for our customers. 

View our guidance for data centre planning and development

Note: The Victorian Government has identified data centres as important infrastructure for the state’s future economy. Its Sustainable Data Centre Action Plan sets out a coordinated approach to planning, investment and sustainable growth.

Our approach aligns with the Victorian Government’s direction by supporting responsible development, promoting efficient water use and helping protect long-term water security.

Our approach

Data centres are important infrastructure that support our growing digital economy. They can use large amounts of water.

We’re working with government, industry and developers to identify servicing solutions that protect water resources and support the needs of current and future communities.

We assess proposals to develop data centres in our service area on a case-by-case basis. We consider factors such as water security, infrastructure capacity, regulations and servicing requirements.

We look to these principles to help guide our decision-making. These guide how we balance water security, community needs and sustainable economic growth.

1. Protect water security

Water is a precious resource that must be managed responsibly for current and future generations.

We consider how much water a data centre will need and whether there will be enough water to support that demand in the future, including during periods of drought and as our communities grow.

Drinking water may be considered for domestic, interim or backup purposes. We’ll carefully assess proposals involving large, ongoing water demand for cooling against future water supply needs and network capacity.

2. Recycled water first, where possible

Our preferred approach is for recycled water to be the primary source of cooling water where possible.

Using recycled water can reduce demand on drinking water supplies and support Victoria's long-term water security goals.

We encourage developers to explore recycled water opportunities early in the planning process and incorporate them into project designs wherever possible.

3. Minimise impacts on customers and communities

We seek to support new data centre developments while minimising impacts on existing customers, communities and the services they rely on.

When assessing proposals, we consider potential impacts on water, sewerage and trade waste services, as well as the capacity and reliability of supporting infrastructure.

4. User pays

New infrastructure required to service a data centre should be funded by those creating the demand, rather than existing customers.

We apply fair and transparent cost recovery and infrastructure contribution principles to support sustainable growth while minimising cost impacts on our customers. 

5. Plan for the future

Data centres are built to operate for many years, so it's important they can be supported both now and into the future.

We consider whether our water, recycled water, wastewater and trade waste systems can continue to meet demand as our communities grow.

We also consider how well these systems can cope with challenges such as drought, population growth and a changing climate.

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