Australia is now a top-10 global data centre market, and power availability, ahead of capital or demand, decides who wins it.
Australia is a top-ten global data centre market of roughly 1.35 GW operating IT load, and power availability rather than capital or demand now decides who wins it. The evidence, with every figure sourced and dated.
Operating capacity reached ~1.35 GW at end-2025 after a ~40-fold, 20-year occupancy expansion. US$6.7bn was invested in 2024, second only to the US globally. The constraint has moved: 44 GW of connection requests sit with AEMO against ~6 GW the system actually needs, and only ~25% of the announced pipeline is fully deliverable.
One contract reset the market's scale: CDC's 555 MW hyperscale deal equals ~40% of everything operating nationally in 2025.
The May 2026 contract (10-year minimum, US investment-grade counterparty) lifted CDC's independent valuation A$3.5bn in a quarter and implies ~A$2m/MW/yr of contracted hyperscale EBITDA, the clearest per-MW economics anchor the Australian market has produced.
+A$3.5bn CDC independent valuation uplift in a quarter ~A$2m/MW/yr contracted EBITDA
July 2026 made energy policy the industry's central variable: large data centres must become 'net generators'.
The Commonwealth will require large facilities to add at least as much generation as they draw, pay full connection costs and curtail under grid stress. AEMC's four-pillar advice (28 Jul 2026) turns that into certificate, firming, registration and flexibility obligations. Every large project's cost and schedule now carries policy risk.
Sydney holds ~60% of capacity and ~65% of the pipeline: the market is a two-metro story with a sovereign capital attached.
NSW alone carries 44 projects totalling 11.4 GW of pipeline; Melbourne's west is the second corridor. Canberra anchors sovereign government demand. Tasmania has emerged as the AI-factory frontier (Firmus, up to 400 MW).
REGO surrender
Firm capacity
Market registration
Every large project's cost and schedule now carries policy risk.
Market registration. Source: ITK Research (May 2026); M3 Property (Nov 2025); Knight Frank / Quartz (2025-26); AEMO-Oxford Economics 2025 IASR; Bloomberg via Energy Connects (6 May 2026); Reuters (4 Sep 2024); Energy Storage News / PV Tech (Jul 2026); AEMC (5 Aug 2026); CBRE via Certified Strategic (May 2026); Climate Council/DC Byte (Jun 2026); King & Wood Mallesons (6 Aug 2026). As at 21 Sep 2026.
- NSW
- 44 projects totalling 11.4 GW of pipeline
- Melbourne
- the west is the second corridor
- Canberra
- anchors sovereign government demand
- Tasmania
- AI-factory frontier (Firmus, up to 400 MW)
Valuations price flawless conversion: the September 2026 NEXTDC sell-off shows how fragile that pricing is.
NEXTDC trades at ~45x FY26 EV/EBITDA with a 565 MW forward order book still to convert; AirTrunk cleared at 21x contracted EBITDA (~87x expected 2024 EBITDA; the gap is denominator definition, explained in Section 09). Shares fell ~14% in a month amid AI-boom volatility; Blue Owl is testing exit depth with a >US$30bn Stack APAC exploration.
With demand established, the investable question is which announced megawatts are deliverable.
Demand evidence is strong: take-up exceeded new supply for the first time in 2023-24, 68% of construction is pre-committed vs a 38% norm, and AI-specific demand rose ~27x in 20 years. The sorting mechanism for the next five years is power access, planning speed and balance-sheet depth.
| 2030 scenario | Operating capacity | Implied CAGR 2025-30 | Core revenue 2030 | Core driver |
|---|---|---|---|---|
| Bear | 5.0 GW | 29.9% | A$7.6bn | Net-generator costs + grid queues stall conversion; low end of the planning band |
| Base | 6.0 GW | 34.8% | A$8.8bn | 555 MW-class contracts convert; AEMO Step Change requirement is met |
| Bull | 6.22 GW | 35.7% | A$10.1bn | Every under-construction megawatt commissions and 35% of planned capacity converts |
Scenario table: inashanu estimates on the operating IT load basis. Bear is the low end of the 5-8 GW planning band (dossier synthesis, 17 Sep 2026); base is the AEMO Step Change requirement of ~6 GW (2025 IASR); bull is built from the 24-project pipeline and lands 220 MW above base, which is the finding. Mordor (7.18 GW) and M3 (~9.5 GW early-2030s) count capacity on their own bases and are carried as context. Revenue grown from the A$5.6bn 2026 inashanu sizing at 8/12/16% p.a. Method in Section 10.
| Item | GW |
|---|---|
| End-2025 | 1.35 |
| Bear | 5 |
| Base | 6 |
| Bull | 6.22 |
Sources
- ITK Research, as at May 2026
- M3 Property, as at Nov 2025
- Knight Frank / Quartz, as at 2025-26
- AEMO-Oxford Economics 2025 IASR
- Bloomberg via Energy Connects, as at 6 May 2026
- Reuters, as at 4 Sep 2024
- CBRE via Certified Strategic, as at May 2026
- inashanu sizing and scenario estimates (Sections 02, 10)
- Energy Storage News / PV Tech, as at Jul 2026
- AEMC, as at 5 Aug 2026
- Climate Council/DC Byte (Jun 2026). Pillar detail: AEMC, as at 5 Aug 2026
- King & Wood Mallesons, as at 6 Aug 2026
- IMARC, as at 2026
- Climate Council/DC Byte, as at Jun 2026
- Kalkine, as at Jul 2026
- Yahoo Finance, as at 16 Sep 2026
- PwC Australia, as at Mar 2026
- Reuters Breakingviews, as at Sep 2024
- Bloomberg, as at May 2026
- Mingtiandi, as at Jul 2026
Related
- Why do Australian data centre market size estimates differ so much?
- How much data centre capacity will Australia have in 2030?
- How much electricity do Australian data centres use?
- Who are the largest data centre operators in Australia?
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