Residents say AI factories with unknown environmental impacts are being rushed into development as proponents argue Australia must ride the data boom or be left behindFollow our Australia news live blog for latest updatesGet our breaking news email, free app or daily news podcastWhen West Footscray resident Sean Brown takes his 19-month-old boy to the park, their walk passes an imposing new building cheerily spruiked as “Australia’s largest hyperscale AI factory”, a datacentre called M3.He hates it: the construction noise from its constant expansion, the looming towers and the insistent background hum, the exhaust from the growing array of diesel generators that can help power the ranks of servers inside.And he worries what it represents for his young child’s future.“He is growing – neurologically, pulmonarily, physically – in the shadow of a facility whose cumulative environmental impact … has never been assessed,” Brown says.“They’re building something which is, frankly, terrible for the community.

There’s no upside to it and it’s just getting worse.”The centre has already grown several times, fuelling the endless appetite of this age of digital services and generative AI.By the end of 2027, should fast-track planning approval be granted by the Victorian government, this datacentre less than 10km from the Melbourne CBD will have doubled in size again to cover 10 hectares, drawing 225MW of power and running 24/7.Diesel generators on the site are reportedly expanding from 40 today to 100 at completion.Eight months ago, NextDC’s chief executive, Craig Scroggie, posted a video of the M3 site on LinkedIn and said the speed and the scale of its expansion were “stunning”.

“We’re building Australia’s largest hyperscale AI factory purpose-built for the new AI era of accelerated computing,” he wrote.“This is how we build Australia’s digital future: speed, scale, sovereign, sustainable & secure.”Australia is under pressure to compete in the growing datacentre industry amid the promises of an AI boom.New investments are hailed as vital downpayments on the country’s economic future.But those living closest to these massive new data halls feel that their neighbourhood peace is being sacrificed on the altar of progress.

Guardian Australia spoke to residents in three states about their concerns, which are emblematic of the growing opposition to these developments across the country.Those living closest to datacentres argue they should be moved further away from residential areas in the country’s biggest cities.The M3 datacentre is “just a really inappropriate location for what is pretty much [an] intensive industrial building,” Brown says.“It’s right next to people’s houses.”Brown says the original zoning decisions did not take into account the sheer scale of the datacentres.

He works in the tech sector, and understands the need for datacentres,But he argues the datacentre boom needs to be planned better,“It’s like they’ve just gone: ‘Let’s just maximise this and don’t even consider the impact,” he said,A spokesperson for NextDC says the project is being delivered in accordance with local and state government processes and regulatory requirements, and it has processes in place to “manage and respond to feedback”,The Maribyrnong local council has expressed its opposition to the expansion, but it is now awaiting planning approval from the Victorian government.

A spokesperson for the Victorian planning minister, Sonia Kilkenny, said the proposal to expand the datacentre was under consideration and it would be inappropriate to comment further,Near Lane Cove River, 9km from the Sydney CBD, a proposal for a new 90MW datacentre named Project Mars is now being considered by the NSW government,It would be the fourth in the area: datacentres take up 40% of local industrial zones,The council argues the nearly 22,000sqm, three-storey centre exceeds height limitations and would be visually prominent next to bushland and residential zones,Local resident Daniel Bolger says it will sit next to what he calls “the lungs of Lane Cove: Blackman Park.

It used to be a tip, but was turned into a park and sporting hub “used by 50% of the suburb” each weekend, he says,“[Now] they’re going to put datacentres right next to it,”He says the council has been sidelined, and there are community concerns over the proximity to schools of the centres being developed, and the pure power draw,“This is the cluster issue,” Bolger says,The NSW planning minister, Paul Scully, says the public are encouraged to have their say during the consultation and a full merit-based assessment, including an assessment of energy needs, will be conducted before a decision is made.

“Datacentres are an important part of the infrastructure and digital architecture of modern economies,” he says.The developer, Goodman Property, did not respond to a request for comment.In Hazelmere, 15km east of Perth in Western Australia, community opposition is growing to a planned 15,000sqm, three-storey, up-to 120MW datacentre.“It’s huge.Bigger than a Bunnings warehouse,” Kate Herren, a local resident and a fundraising coordinator for the environmental group Trillion Trees Australia, says.

“The location we feel is wholly unsuitable for a proposal of [this] size and scale,”Walter McGuire, chair of the Bibbul Ngarma Aboriginal Association, says the Noongar people have a role and responsibility to care for the Mandoon Bilya (Helena River),“Giant datacentres belong in industrial areas, not on the banks of our rivers and wetlands,” he says,“[It] is a culturally significant river, and the wetlands that surround it … So we have grave concerns about its impact on the river and the surrounding ecosystem,”The proposal is now before the council.

A spokesperson for the City of Swan said it was unable to comment.A spokesperson for GreenSquareDC, the company behind the project, said it was in an established industrial area with major transport and power infrastructure.“We clearly understand there is interest in this proposal given its proximity to existing businesses and the local school,” the spokesperson says.“These considerations are taken seriously, and GreenSquare is committed to engaging constructively throughout the planning process.”Data Centres Australia’s chief executive, Belinda Dennett, says the industry is aware that construction of these centres can be confronting “particularly where industrial zoned land meets with residential areas”, but maintains developers meet strict environmental and building standards, and were seeking to minimise disruption.

She says Australia has a “significant opportunity” to benefit from datacentre investment, through new businesses and jobs,“These benefits will flow to the local communities that neighbour datacentres too,”On Friday, she told a NSW parliamentary inquiry into the sector that if Australia does not develop its own AI infrastructure, it will become “an importer of someone else’s technology, that has no Australian culture, values or laws built into that”,The alternative, she said: “we build that here and we have some say [and] control over what that looks like”,This article was amended on 3 May 2026.

An earlier version included a caption that incorrectly said a NextDC, rather than a Goodman Group, datacentre development proposal would put a campus next to the Blackman Park oval.