# Rural Council Questions Massive South Australian Data Centre Proposal Local officials demand clarity on water usage and tax exemptions for Firmus Technologies project. - **Source:** [PerthNow](https://www.perthnow.com.au) - **Published:** 2026-11-06 - **Topic:** [Business](https://brifing.si/c/business) - **Original article:** - **On Brifing:** https://brifing.si/s/21ec920c-c078-4cb8-8660-84cc2e2ed080 ## Council Seeks Project Clarity The Port Augusta City Council has formally requested information regarding a massive 1300-megawatt data centre proposed by Firmus Technologies. Located near Stirling North, the project includes ten AI data halls and a substation. Officials remain concerned about the lack of transparency regarding the development's true scale and its potential impact on local infrastructure. ## Water Usage and Cooling Firmus Technologies estimates the facility will consume 345 megalitres of water annually. The company plans to utilize a closed-loop cooling system, which increases water demand during extreme heat exceeding 35C. While the firm claims it will avoid using local water mains, the council demands proof that this will not affect existing community resources. ## Tax Exemption Concerns A primary point of contention involves potential rates exemptions for the infrastructure project. The council is seeking absolute assurance that no legislative concessions will be granted under Land Valuation Regulations. They want to ensure the development contributes fairly to local tax revenue, preventing any reduction in the value of rates paid to the region. ## State Government Oversight South Australia classifies data centres as essential infrastructure, shifting approval authority from local councils to the state planning minister. Infrastructure and Planning Minister Nick Champion is expected to provide a response to the council's report. Meanwhile, the government has stated it currently has no plans to introduce tax or council rates exemptions for such projects. ## Firmus Technologies Expansion Strategy This proposal is part of a broader expansion plan for Firmus Technologies across Australia. The company is also developing a 288MW data centre in Tasmania's Bell Bay and a 1000MW factory in Tailem Bend. These projects are supported by a 12-year wholesale energy supply agreement with Gunvor Group to manage electricity consumption during market stress. ## Regulatory Framework Evolution Premier Peter Malinauskas introduced a specific data centre strategy in June to guide industry growth. The state government intends to propose new legislation to parliament to better regulate these large-scale developments. This shift reflects the state's ambition to become a hub for AI infrastructure while balancing the needs of rural communities and environmental sustainability. ## Community Engagement Challenges During a September drop-in session, Firmus Technologies attempted to address local concerns regarding cooling systems and water sources. Despite these efforts, the council tabled a critical report on October 13, citing unanswered questions about road impacts and environmental needs. Neither the company nor the state government has provided a formal response to these specific inquiries. ## Future Infrastructure Implications The tension between rural councils and large-scale tech developers highlights the challenges of rapid industrialization in regional areas. As South Australia prioritizes AI infrastructure, the balance between state-level economic goals and local governance remains fragile. Future developments will likely depend on how effectively the government addresses transparency and resource management concerns raised by local authorities. ## Sources covering this story - https://www.perthnow.com.au/news/business/major-data-centre-proposal-leaves-council-in-the-dark-c-23124330 — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._