AI training and inference for large language models requires a staggering amount of physical infrastructure. Finding an appropriate location that has ready access to power, internet and a bit of water, would be a challenge with steady growth, but the rate of growth in AI is unlike anything we’ve ever seen.
Even as the frontier model providers in the US consider a slowing to the rate of progress out of safety concerns, the thirst for more generative AI is not slowing down.
Member for Albury, Justin Clancy MP posted today on social media, addressing the community about the proposed development of a new AI data centre right in our backyard.
The proposal from Sharon AI has understandably sparked a lot of chatter, expected whenever a multinational tech firm wants to develop a facility into a regional area. Clancy confirms locals are right to ask how it will impact the power grid, agricultural water security, and the general amenity of the town.
While frontier model development happens internationally, AI has global use and Australia entities are demanding sovereign data and AI capability.
Building these facilities locally means we do not have to rely entirely on offshore infrastructure. Regional communities have a great opportunity to offer access to land not available in urban areas.
The transformation of a local landmark
The former paper mill on RW Henry Drive at Ettamogah was formerly the site of a massive newsprint machine ran under Norske Skog before the facility shut down in late 2019 because, well, the internet.
That closure took nearly 200 local jobs with it and left a massive industrial footprint sitting idle. Packaging giant Visy bought the plant for A$85 million in 2020, primarily using it as a transport and warehouse depot.
Fast forward to 2026 and the Nasdaq listed tech company Sharon AI, has acquired the site. While the exact purchase price remains under wraps, the plan is to turn this underutilised brownfield site into a high performance computing hub. Visy is expected to stay on as a tenant for their logistics operations, but the main event will be the servers.
Why an old paper mill makes perfect sense for tech
When you strip away the corporate marketing and look at the physical requirements of a modern data centre, the Ettamogah mill is a highly practical solution. When you consider the infrastructure requirements, developing a greenfield site is a much very difficult prospect, but given this facility ticks a lot of boxes on the requirement list, it significantly accelerates the project.
The logistics of a greenfield build are usually a nightmare of zoning approvals, environmental impact studies, and infrastructure trenching.
This site skips almost all of those hurdles. It is already zoned for heavy industry. Because it used to run massive paper manufacturing machines, it is already connected to the high capacity power grid needed to sustain intensive industrial loads.
Power
Clancy highlighted some vital protections under these new NSW guidelines.
Data centre proponents cannot just plug into the grid and drain the local supply. They are expected to contract additional renewable generation to meet their electricity demand. At least 40% of that contracted generation must be wind power.
This extra generation does not have to be built right next to the Ettamogah facility. That means the community needs to keep asking where the supporting renewable infrastructure will actually go.
As Clancy noted, a requirement for additional renewable generation to support a data centre should not be regarded as an automatic green light for any random renewable project in our region.
Water
Crucially, it is already plumbed for water and even features existing water treatment facilities right on the property. Modern datacenters use closed-loop cooling systems, meaning much of the concerns around significant ongoing water usage are overstated.
The state guidelines expect these intensive cooling systems to use recycled water or transition to a supply that does not rely on local rainfall. They explicitly state there must be no adverse impact on agricultural water use in regional areas.
This is where the paper mill legacy is a massive advantage. Paper manufacturing is one of the most water intensive industries on the planet. By leveraging the heavy-duty water infrastructure and treatment ponds left behind, Sharon AI has a massive head start.
They can process and recycle cooling water on site rather than constantly drawing from the local potable supply. This protects the region’s agricultural water security while keeping the server racks from melting down.
Internet
It sits perfectly positioned close to major fibre optic internet infrastructure along the Hume Highway corridor, well away from residential suburbs where noise and traffic would be an issue.
The NSW Government released specific Data Centre Guidelines to manage this exact type of growth. Those guidelines explicitly note that there are far fewer complexities and community impacts when developers choose existing brownfield sites with established energy and water capacity.
The reality of regional tech expansion
Albury is not entirely new to the data centre game. We already have modern data infrastructure operating locally, including a regional edge facility run by Leading Edge Data Centres. Those edge networks are fantastic for reducing latency and keeping local business data close to home.
That said, the sheer scale of artificial intelligence compute is an entirely different beast. Training an AI model requires thousands of processors running at maximum capacity for weeks on end. It requires industrial scale engineering.
We will need to keep a close eye on this development as Sharon AI undertakes its formal community consultation. If the guardrails hold up and the environmental protections are enforced, this is a brilliant opportunity to repurpose an empty industrial site for the future of tech.
It brings cutting edge infrastructure to regional Australia without the growing pains of starting from dirt.
For more information, head to Sharon AI and find Albury’s Justin Clancy FB post here..
