A note has been circulating Clyde and surrounds in regards to Contact Energy’s application for resource consent to build a data centre near the Clyde Dam. 

The proposed project is aiming to house eight containerized data centers and nearly 3,000 servers.

A Contact Energy spokesperson told The Central App the company has indeed applied for a resource consent for a data centre. 

“It will be located below the Clyde Dam on Fruitgrowers Road, on the western side of the Clutha River / Mata-Au. 

“This is helping Lake Parime (a privately owned, UK-based digital infrastructure company) who will be leasing the 0.65 hectares of land for the data centre to be built on.”

A letter has circulated the community which raises concerns in regards to sound, funding by consumers, and profits sent overseas. 

The Contact Energy spokesperson responded to the concerns and said the data centre will be used for a range of specialist tasks by UK-based digital infrastructure start-up Lake Parime.

“We have seen the anonymous letter that is circulating and have had two people repeatedly contacting various members of our team outlining their concerns along these lines,” the spokesperson said. 

“We have taken their concerns seriously and responded to them at length over the past few weeks. We believe their concerns are unfounded.”

“A quick indication is; the proposed data centre will be used for industrial scale data processing and high-performance computing applications, e.g. machine learning, weather models, data visualisations, block chain and cryptocurrency mining. 

“Lake Parime is pursuing a diversified portfolio of data services, which was a key condition of our decision to enter into a supply agreement. 

“We do not want to supply electricity to a data centre solely relying on mining cryptocurrency given the potential volatility of that market.”

The letter circulating the Clyde community raising concerns with the proposed data centre. Photo: contributed. 

In regards to sound concerns, the spokesperson said they have taken steps to mitigate any noise and invested in infrastructure accordingly. 

“Yes, the data centre will put out some noise,” the spokesperson said. “However, as identified in our resource consent, we have taken a highly conservative approach to mitigating any noise impacts to neighbours in the vicinity of the data centre”. 

“The facility will be contained within a 3.5-meter wall which is designed to deflect noise away from the Clyde township and neighbours to the south, and the Powerboxes will be modified in NZ with noise mitigating equipment.   

“We are also currently in the process of employing noise experts to see if there are any further actions we could take. This will be above and beyond any District Plan obligations.”

There will be no cost to locals, the spokesperson says, and reiterated the energy company thoroughly believes the data centre will “In fact we think it is a good thing for the local community”. 

“As we have said previously during the construction and commissioning period the datacentre operators will engage and employ local contractors including electrical firms, building firms, landscaping operators, and specific staff to monitor the datacentre operations; and once operational the datacentre will provide a small number of highly skilled jobs. 

“Contact and Simply are working with Lake Parime to help find staff to monitor the establishment of the data centre. 

“They will be employed to monitor the IT infrastructure as well as checking on the physical aspects of the data centre to ensure it runs smoothly.

“We are also excited to see what opportunities it could bring to the area. 

“We know there is a large global industry in data centres and we are excited about what it could bring to Central Otago. 

“In saying that, we aren’t the industry experts here – the Central Otago District Council Economic Development Manager and Lake Parime are probably best-placed to talk through the potential and possibilities here.”

“There is also positive news for the security of electricity supply in the area and some broader benefits to the Clyde community. 

“The data centre operators will fund a substation connection at the Clyde dam site – it is currently supplied from a single Earnscleugh-Clyde substation line.

“Once the data centre and related network is installed, the next stage is to use this infrastructure to provide a second connection across the river for the local community, which will bolster electricity connectivity and supply security in the long term.”

At its peak it will consume 10MW of energy, according to Contact Energy. 

“However, the design of the data centre is to allow fluctuating power use, and will only use peak amounts when that electricity isn’t required elsewhere.

“We call this demand flexibility and you can read more about it here.”

The Central Otago District Council (CODC) has identified 17 affected parties and are in the process of notifying them. They will have the opportunity to provide feedback and make a submission.

Submissions from the potentially affected parties need to be received by 23 November and there is likely to be a hearing at the end of that process chaired by an independent commissioner.