Data centres: Building opportunities on solid foundations

• Data centres are the backbone of New Zealand’s digital economy, enabling critical services, growth and innovation.

• Demand driven by AI and cloud computing is accelerating faster than energy supply, infrastructure and workforce capacity.

• Long-term, sustainable growth depends on coordinated collaboration between industry, energy providers and government.

Every business-critical system – from banking platforms to supply chains, financial transactions to enterprise applications – relies on data centres. Data centres are the unseen engine rooms: powering cloud platforms, processing expanding AI workloads and underpinning critical services across every industry.

The recent NZTech report, Empowering Aotearoa New Zealand’s Digital Future – Our National Data Centre Infrastructure, highlighted the scale of the opportunity for our data centre sector. With 56 operational data centres (four of which are owned and operated by Datacom) and 20 more planned, the sector is forecast to attract over $10 billion in investment over the next decade. It already underpins $16.5 billion in ICT GDP and enables a further $76.5 billion in knowledge-intensive services. Beyond economic impact, data centres are creating thousands of jobs, driving regional development, and positioning New Zealand as a potential hub for sustainable digital exports.

Given the scale of the opportunity that exists – and the fact data centres are the foundation of our digital economy and a catalyst for growth, sustainability and innovation – there is work to be done to ensure we are positioned for success, and it requires a collaborative approach across the sector, and at a national and regional level.

The opportunity is huge, but it won’t happen by itself. The NZTech report rightly highlights a critical tension: demand is accelerating faster than our supporting infrastructure. AI and cloud workloads are reshaping the landscape, driving unprecedented energy requirements. Goldman Sachs estimates global data centre power demand will rise by 50 percent in two years. While New Zealand’s renewable profile is a strength, current generation is not yet sufficient to meet projected demand.

This is not just about electricity. We also need smart planning, skilled people and a strong foundation for long-term digital resilience. Building world-class facilities means ensuring grid capacity, accelerating renewable generation and addressing workforce shortages. Without coordinated action, we risk bottlenecks that could stall growth and undermine our sustainability goals.

Listen now: Discover how Datacom is reshaping data centres for the AI era - from liquid cooling and ultra‑efficient power models to data sovereignty, resilience and sustainable scale. In this iTnews podcast, Datacom's Director of Data Centres Matt Neil breaks down what it takes to build truly future‑ready infrastructure across Australia and New Zealand.

At Datacom, we share NZTech’s optimism, but we are pragmatic about what it will take to realise this vision and to do so sustainably. For our data centres team, sustainability is embedded in how we design, build and operate. We have secured a 10-year certified renewable energy agreement with Mercury, signalling demand for further renewable capacity. Our data centres run at industry-leading efficiency, with Power Usage Effectiveness (PUE) as low as 1.2, compared to the global average of 1.54. Advanced cooling technologies, including liquid cooling and free-air economisers, reduce both energy and water use.

Resilience matters too. Every Datacom facility is built on N+1 or N+2 redundancy, backed by robust processes and 24/7 onsite support. This is how we deliver 100 percent SLA availability for customers whose operations cannot afford downtime. And because we are more than a data centre operator – offering integrated IT services, cloud, networking and security – we help organisations navigate complexity, from hybrid environments to compliance and sovereignty requirements.

Our data centre footprint spans Auckland, Hamilton, Wellington and Christchurch, supporting regional growth and national resilience. We are actively exploring expansion opportunities, but always with an eye on energy and water availability. Growth must be strategic and sustainable, not speculative.

The NZTech report recommends forming a Data Centre Industry Ministerial Advisory Group. We strongly support this. Collaboration between operators, energy providers and government is essential to streamline planning, accelerate renewable generation and build the skills pipeline. This is not just about meeting today’s demand; it is about futureproofing for AI, edge computing and real-time services that will define the next decade.

New Zealand has natural advantages – renewable energy, a cool climate, political stability – that make us an attractive destination for global investment. But these advantages will only translate into leadership if we act decisively. That means aligning data centre growth with energy strategy, embedding sustainability at every level and ensuring our workforce is ready for the jobs this sector will create.

The opportunity is real. So are the challenges. By getting the foundations right, we can position Aotearoa as a global leader in sustainable, resilient digital infrastructure.