Anger over Tungkillo data centre should have Labor on red alert

Data centres have become so politically toxic that they've managed to bind together the Greens and One Nation.

The two ideological opposites stood side by side at a community rally in Mannum last weekend, speaking out against a Melbourne developer's bid for a hyper-scale data centre in Tungkillo, roughly 40km east of Adelaide, over concerns about the environment, energy and water use.

The Liberal Party was there too, demanding that locals who are fiercely opposed get a genuine say. Mid Murray Council Mayor Simone Bailey, who ran for Labor at the March state election, told the ABC it was "really hard to understand the benefits" of the proposal.

Popular independent federal MP Rebekha Sharkie is also against it, posting on Facebook that "Data Centres do NOT belong on prime agricultural land".

The broad coalition that's forming in Tungkillo comes with the backdrop of the US midterms, where Americans used their ballots as a sledgehammer against pro-data centre proposals and politicians.

Labor in SA should be on red alert.

No data centres for the sake of data centres, premier says

The bulk of the anger in Mannum over the weekend was directed at Quantum DC, a company that has had — to put it mildly — a few hiccups with its community consultation process.

But Labor copped plenty of criticism as well, accused by both Greens MLC Robert Simms and One Nation's Carlos Quaremba of "rolling out the red carpet" for data centres.

The government has reason to dispute that characterisation.

It has drafted new laws proposing tougher energy and water requirements on the computing facilities, with Premier Peter Malinauskas declaring "if they're not in our interests, they're not happening".

The premier appears to have taken plenty of lessons from the US, criticising their "let it rip" approach.

"They have let data centres be built next to residential homes, they have let data centres be built without any reference to new generation coming on board, we've seen blackouts, we've seen price increases, it's madness," he said.

"If it's going to happen in Australia, it cannot happen like that."

Quantum DC is also yet to lodge its planning application for Tungkillo, with the government saying it doesn't want to "pre-judge" the project.

"I don't even know who these people are, like they haven't even applied," Mr Malinauskas said of the Tungkillo proposal.

"And it's causing an awful amount of community anxiety over a process that no one's ever started formally.

"That doesn't represent the sort of way we want to go about engaging with this."

Mr Malinauskas said he wanted to see a "proper regulatory and legislative environment" that allows his government to "stop data centres from happening unless they comply with our standards".

At the same time, however, the premier and his state development minister, Chris Picton, seem to be the only state politicians who this year have offered anything resembling positive commentary about data centres.

The political wisdom of standing alongside Firmus co-founder Oliver Curtis in June to spruik new AI development in SA is quite easy to question in hindsight, particularly given the spectacular collapse of Firmus' IPO four months later.

Not to mention the government's data centre strategy has plenty of verbs in it like "accelerate" and "streamline" to send a chill down the spine of data centre opponents.

"We are proactively engaging global and domestic AI companies and data centre developers to land major investments, build capability, and create high-value jobs for South Australians," the strategy states.

These are all elements that, fairly or unfairly, could come back to haunt Labor should more unpopular AI proposals lob in other marginal seats.

Because currently, there appears to be far more votes to be won leaning into concerns about data centres than courting their arrival.

Rigorous process or concerning gap?

The government's messaging on Tungkillo has also been curious.

On Saturday, Planning Minister Nick Champion spoke to the media to provide some reassurance to the Mannum community, noting the government controlled the planning pathway for the Tungkillo data centre.

"Whatever the pathway, the process is rigorous," he told reporters.

"There is a very rigorous test on power, they cannot jeopardise our grid, they cannot jeopardise the stability or the power capacity of our grid, they have to pass a test on water, and they have to pass rigorous tests in the planning system."

Yet by the time we got to Thursday, the premier was talking about the urgent need for law reform.

"At the moment, data centres can apply for development applications and the like and we don't necessarily have the controls that we desire to be able to ensure that they do bring their own energy, that they do comply with environmental standards," he said.

"We need to be able to restrict these things from happening unless they do it in circumstances that is in the state's interests."

Labor will soon need to pass its data centre legislation through the upper house of parliament, where it does not hold a majority.

Instead, they will need to negotiate with their political opponents who are leaning into data centre angst.

Don't be surprised to see that Greens and One Nation alliance pop up again.