The rapidly growing data center industry is placing an increasingly serious burden on urban water systems.
Australia is preparing for a chronic water shortage - the country plans to significantly expand its desalination capacity. Turning seawater into fresh water is a necessary measure, as the average annual rainfall is decreasing, and it is no longer sufficient to meet the growing demand for fresh water from the population, writes Bloomberg.
According to a research report by Oxford Economics analyst Dominic McNally, the construction and modernization of 11 desalination plants is planned over the next ten years on the driest inhabited continent. The total investment in these projects will exceed 23 billion Australian dollars (about 15 billion USD).
McNally estimates that population growth will lead to a sharp increase in water demand in major cities in the coming years: by 2035, households will need an additional approximately 190 gigaliters per year. And this is only part of the problem. The rapidly growing data center industry is placing an increasingly serious burden on urban water systems - the "invisible" digital infrastructure that consumes vast amounts of water.
"The increase in consumption is happening at the most unfavorable moment - against the backdrop of a sustained decline in rainfall in densely populated areas. As a result, water infrastructure designed for different climatic conditions is becoming increasingly vulnerable," the analyst emphasizes.
After 2010, the pace of water infrastructure construction in Australia slowed down: the country emerged from a prolonged drought, and the water issue became less acute. However, a series of new droughts has once again brought the issue of water security to the forefront. This coincided with a new wave of investment in water management - primarily in the development of desalination capacity, notes Oxford Economics analyst Dominic McNally in his report.
In dry years, Australian households regularly face summer water consumption restrictions. This problem is particularly acute in South Australia - a region where a significant part belongs to arid and semi-arid zones (climatic areas with chronic moisture deficiency - ed. note). According to Oxford Economics, in certain areas of the country, the demand for drinking water will increase by more than 10% over the next decade.
Industry is also increasingly competing for water in the region. For instance, BHP Group plans to invest 840 million Australian dollars in expanding the large mining complex Olympic Dam in South Australia.
According to Oxford Economics, this project, like other resource initiatives in the region, will require the construction of a desalination plant - with water intake from Spencer Gulf, to ensure the required volume of extraction and processing of raw materials.
The production of green hydrogen and ammonia also requires vast amounts of energy and fresh water. Therefore, such projects are increasingly being located in arid coastal regions - primarily in the Pilbara in Western Australia and Gladstone in Queensland. Here, the best conditions in the country for solar and wind generation have been created, and the shortage of fresh water is compensated by desalinating seawater.
According to analysts at Oxford Economics, it is industrial water consumption that will become the main driver of large-scale water infrastructure construction in Western Australia, South Australia, and Queensland in the second half of the 2020s.
"As a result, desalination is once again coming to the forefront: water authorities are increasingly betting on expanding such capacities as the foundation of their investment programs for the next decade," says Dominic McNally.
