Australian Economic Comment The data centre boom: lessons from the LNG boom

Research evidence excerpt

Australian Economic Comment The data centre boom: lessons from the LNG boom

29 June 2026

Australian Economic Comment Economics

The data centre boom: lessons from the LNG boom Australia

◆ Australia's current data centre investment boom is one of the world's largest - Paul Bloxham

much as Australia’s early 2000s LNG investment boom was at the time too. ChiefNew ZealandEconomist,& GlobalAustralia,

Although not a perfect comparison, there are clear similarities. Both booms CommoditiesHSBC Bank Australia Limited

draw heavily on local energy supplies once completed, are highly import- paulbloxham@hsbc.com.au+61 2 9255 2635

intensive in the investment phase, have high-foreign ownership, employ few

workers, particularly once operational, and make products (gas and compute)

that are growth drivers whether used locally or exported. The LNG boom may

offer policymakers lessons on how to manage the datacentre boom.

Australia has one of the largest data centre investment booms in the world currently underway. Estimates

available from Australian Energy Market Operator suggest the investment pipeline is worth AUD97 billion,

which is around 3.4% of GDP. Australia has 1.4 gigawatts of capacity and AEMO estimates show

applications for another 5.4 gigawatts.

We have written quite a bit on this topic of late (see ‘Australia’s AI and tech sector opportunities’, 20

November 2025; ‘Weak productivity and how A.I. could help’, 23 February 2026; ‘Data centres, AI and

Australia’s productivity’, 23 June 2026).

A key question is how much Australia’s economy will benefit from this boom?

The near-term benefits are limited. Although business investment has surged, 85% of the equipment used

is imported, so there is little near-term boost to local GDP growth. Imports of IT equipment have surged,