Data centre developers can choose a Victorian government planning pathway that leaves councils with limited influence over major projects, Melbourne councils have told a Senate inquiry, as local governments call for greater control over rapidly expanding AI infrastructure.
The City of Melton told the Senate Environment and Communications References Committee that all data centres in the municipality so far had gone through the Victorian government’s Development Facilitation Program (DFP), leaving council to provide feedback rather than make the decision.
“There are two pathways for data centre approvals from a planning lens,” said Samantha Romaszko, Melton City Council’s director of City Futures. “All data centres within the City of Melton at this point in time have gone through the Victorian government’s Development Facilitation Program.”
Under the state pathway, council has a limited timeframe to assess an application and provide feedback to the Department of Transport and Planning, she said. “As such, as a council, we have not considered or made any determination on these applications.”
Rachel Dapiran, acting chief executive of Hume City Council, said proponents had previously approached councils but were increasingly using the state pathway. “We have had them come through and ask us, the decision-maker, a year or two ago, but, more recently, we’re finding they’re all going through the development facilitation program, so the proponent gets to choose,” she told the inquiry.
Under the DFP’s Clause 53.22 pathway, applications for eligible projects, including data centres that meet the relevant thresholds, are made to the Minister for Planning rather than to local councils. Victorian government records show multiple data centre applications being assessed under Clause 53.22 through the DFP.
Limited say
For councils, the issue is not opposition to data centres themselves but their limited say in decisions made through the state pathway. “We are not opposed to technology, innovation or Australia’s digital future,” Maribyrnong Mayor Mohamed Semra told the inquiry. “Data centres are an important part of our economy, and we understand Australia needs digital infrastructure.”
But Semra said the existing planning framework was “not fit for purpose” and called for councils to have a greater role. “We don’t believe that it should bypass council. In the event that it does, we want our view to be taken seriously. We believe now that it’s not.”
Kelvin Walsh, Brimbank City Council’s director of City Futures, said the state was increasingly taking responsibility for assessing and approving data centre applications. “Fundamentally, local government and the city of Brimbank see the responsible authority role, in relation to planning applications, as being our bailiwick, our jurisdiction,” he said.
Melton is seeking a moratorium on data centre permit determinations until a coordinated framework involving all levels of government is established. The council said that framework should include early council involvement, strategic planning for data centre precincts, mandatory disclosure of energy and water capacity, infrastructure investment requirements and emergency management standards.
Brimbank has similarly called for a moratorium on new data centre applications until binding planning controls and mandatory sustainability standards are introduced.
Walsh said local councils brought knowledge of infrastructure capacity, land-use issues and community risks that could be lost when applications moved directly to the state. “We’re increasingly concerned that, with the state assessing more of the applications, our local communities are being left out of the process,” he said.
Hume Mayor Carly Moore said the council was calling for a temporary moratorium on approvals of new data centres and expansions of existing facilities. Asked whether she was disappointed the Victorian government’s 22 September announcement did not go further on a moratorium, Moore said: “I don’t think it goes far enough.”
She added: “I don’t think we want to see any new approvals or any expansions until we have that clear framework.”
The Senate inquiry is examining the effectiveness of existing regulatory frameworks as Australia’s data centre and AI infrastructure pipeline grows.