Australian water infrastructure company coNEXA will invest AU$250 million to expand its AquaNet recycled water network in Western Sydney, supplying up to 16 million litres of recycled water a day from its Fairfield recycled water plant to NextDC’s S4 Sydney data centre at Horsley Park.
Construction is scheduled to begin in November, with the first water expected to flow in late 2027. The project has received approval from the NSW Independent Pricing and Regulatory Tribunal (IPART) and will be funded entirely by the private sector, according to coNEXA.
The company said the connection is believed to be the largest recycled water supply arrangement for a data centre in Australia. It will enable up to 5.8 billion litres of water a year that would otherwise be discharged to the ocean to be reused, while diverting wastewater equivalent to the output of up to 35,000 homes from a constrained sewerage network.
NextDC’s S4 Sydney campus, being developed at Horsley Park, is designed for up to 365MW of IT capacity and is targeting Tier IV certification, according to the company.
“Data centres are essential to a thriving digital economy, and with that comes a responsibility to use resources carefully. Cooling S4 Sydney with AquaNet’s recycled water puts that responsibility into operation,” said Jeff Van Zetten, NextDC’s chief engineering and design officer.
The operator said recycled water would support cooling designs requiring less power. S4 Sydney is designed to achieve a power usage effectiveness (PUE) of 1.125 at full IT load, which the company says is more than 25 percent below the 2026 global average reported by the Uptime Institute.
“This is exactly the type of project we envisioned when we released the NSW Data Centre Guidelines,” said NSW Minister for Water Rose Jackson. “Instead of sending billions of litres out to sea each year, we’re putting that water to productive use and building infrastructure that can support communities and industry for decades to come.”
Recycled water as data centre infrastructure
The AquaNet project is part of coNEXA’s strategy to expand private-sector water infrastructure alongside data centre development, reducing reliance on drinking water and easing pressure on existing wastewater and water supply systems.
The company’s existing AquaNet network, developed after the Millennium Drought, has supplied recycled water to Western Sydney businesses and industry since 2011. In its submission to the NSW Legislative Council’s inquiry into data centres, coNEXA said the network can provide up to 25 million litres a day of recycled water for industrial use.
The company argued that water infrastructure planning should be integrated into data centre development strategies rather than treated as a separate issue. It said recycled and other non-potable water should play a larger role in cooling, particularly as large facilities increase demand for both electricity and water.
The submission stated that water-based cooling can reduce electricity demand compared with air-based alternatives, while recycled water can reduce competition with household drinking water supplies. It also said that although State Significant Development approvals frequently reference recycled water for cooling, there is currently “little to no” enabling infrastructure in place to deliver it at scale.
Longer-term framework
coNEXA called on the NSW Government to encourage regulated utilities to work with licensed private water infrastructure providers, collaborate on solutions for other data centre hotspots, and initiate a longer-term framework for clearer collaboration pathways between regulated utilities and private water providers. It argued that privately funded, designed, built and operated infrastructure could accelerate delivery while reducing the burden on government capital programmes.
In its submission, coNEXA said water infrastructure needs to be planned and delivered alongside data centre developments to give investors greater certainty over supply and timing.
“NSW has set a clear direction for how the State can sustainably and responsibly host data centres, and recycled water is a key part of it,” said coNEXA CEO Kurt Dahl. “NextDC’s commitment to S4 Sydney unlocks the scale and demand to build the first stage of a network that will serve more of Western Sydney industry and the community over time.”
The network expansion could also create opportunities for other industrial users and local councils, including supplying recycled water for irrigation of public open spaces during dry weather and water restrictions. coNEXA said the project would support up to 200 construction jobs, alongside ongoing roles.