Energy Minister Simeon Brown says new hyperscale data centres should underwrite renewable generation equivalent to their projected power usage, with the Government now taking policy advice on the rules.
Brown's comments are some of the firmest commitments to date by the National-led government on matching rules in Australia and elsewhere which intend to ensure new data ventures don't create pressure on consumer energy prices.
Labour has previously spoken of looking at similar rules, if it were elected, while the Greens pushed for a one-year moratorium on new consents for "AI data centres".
Speaking to Q+A, the Energy Minister said he and Economic Growth Minister Nicola Willis were working jointly on the issue, which has drawn growing scrutiny in recent months.
Simeon Brown defends the development of AI data centres in NZ - Watch on TVNZ+
Asked whether data centres should have to underwrite renewable generation matching their total projected usage, Brown said: "Yes, I think they should, and we're getting some policy advice around what that looks like."
Data centres currently make up about 0.6% of power consumption, he said, but it was projected to grow to about 3% by 2030 "and could significantly grow beyond that".
"We do want them underwriting new investment, new renewables," he said.
"We don't want them pushing up the power bills for people at home."
But Brown said the answer was not to turn investment away.
"The solution isn't to just say don't come here, put the you're-not-welcome sign up, because if we do that, we're a small country at the bottom of the world.
"If we want to have data sovereignty, if we want to have access to AI data centres, which is going to be critical to our productivity, we're going to need these in our country."
But pressed on whether the Government would have the authority to compel operators to underwrite generation, Brown said advice was still coming on "what rules may need to be put in place, or what existing powers we've got".
"At a principled level, I want AI data centres underwriting new generation and growing generation in New Zealand," he said.
"Making sure they can stay on 24/7 is pretty critical, so they're going to need firming as well … if you own a data centre, you ain't going to want it turning off, so it's got to have backup when the renewables not working,
"But I don't want them pushing up the power bills of ordinary Kiwis."
The comments follow Prime Minister Christopher Luxon's suggestion last month that the Government was working on a "compact" setting rules for hyperscale operators.
Luxon said large facilities would need to demonstrate "additionality" to the electricity system rather than drawing on the existing grid.
Party co-leader Chlöe Swarbrick said a freeze was not a ban, as a "one-year pause gives us time to get this right, while National leader Christopher Luxon called it "alarmist". (Source: 1News)
Concerns about the effects of hyperscale data centres flared after Datagrid's $3.5 billion hyperscale data centre near Invercargill was granted resource consent.
The Greens have called for a one-year moratorium on consents for facilities using more than 50 megawatts. Luxon rejected the pause as "alarmist", while Greens co-leader Chlöe Swarbrick said Kiwis were entitled to "a national conversation" about the facilities.
LNG terminal decision before election - Brown
Brown also confirmed the Government intended to make a decision on its planned LNG import terminal before the election, despite advice questioning the project.
Facility near Invercargill boosts dreams of the region to become an artificial intelligence and data hub. (Source: 1News)
"We've been very clear with the New Zealand public about why we're doing this, what we're doing, the fact that we've started a procurement process. We've got international players who've played a role in putting forward their proposals."
Brown acknowledged the war in the Middle East had affected LNG prices, but said forward prices remained "well back within the range that the policy advice was given to us on", and that the International Energy Agency expected new global supply to outweigh what had been lost through the Strait of Hormuz.
For the full interview, watch the video above
Q+A with Jack Tame is made with the support of New Zealand On Air
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