The Victorian Greens have renewed calls for an immediate moratorium on new data centres, as economists warn that Labor’s reckless push to turn Victoria into Australia’s data centre capital risks fuelling inflation, worsening the housing crisis and keeping interest rates higher for longer.
The warnings come just a day after the Reserve Bank raised interest rates again, piling further pressure on Victorian households already struggling with soaring mortgage repayments and the cost of living.
Economic modelling from Barrenjoey forecasts that Australia’s data centre boom could attract $110 billion in investment by 2030, drawing skilled workers away from desperately needed housing construction, adding to inflationary pressures and making it harder for the Reserve Bank to cut interest rates.
The modelling warns that the scale of the boom could keep interest rates elevated into 2028, while competition for construction workers threatens to further constrain housing supply.
The Greens say the findings raise serious questions about Labor’s aggressive pursuit of data centre developments, despite mounting warnings about their enormous demands on Victoria’s electricity grid, water supplies and local communities.
The Greens have been calling for a moratorium on new data centre developments for months, a position now backed by Victorian councils.
As stated by the Deputy Leader and spokesperson for AI and data centres, Dr Sarah Mansfield:
“Victorians are already struggling to pay their mortgages and rents, while a whole generation is being locked out of ever owning a home. Yesterday they copped another interest rate rise, and Labor is making a bad situation worse with its reckless data centre obsession.
“Labor can’t pretend to understand the pain Victorian households are feeling while rolling out the red carpet for big tech corporations that are competing for the workers we desperately need to build more homes, swallowing up land that could be used for housing and adding to inflationary pressures.
“How many more warnings does Labor need? Victorians are being asked to sacrifice their water, energy security and now their hopes of ever being able to afford a home, all for Labor’s short-sighted obsession with attracting big tech investment.
“Victoria desperately needs more affordable homes, cheaper energy, and investment in the things that will actually improve people’s lives. Instead, Labor is putting the profits of some of the world’s wealthiest corporations ahead of the needs of our communities.
“The Greens have been calling for a moratorium on new data centres for months. Labor needs to stop ignoring the warnings, put the brakes on this reckless expansion and start putting Victorians ahead of big tech profits.”
