Energy North drops data centre start timeline in Australia as regulator review slows project

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Energy North data centre delay

Highlights

Energy North no longer commits to the June 28, 2028 'first power' date for Project Ares after the Northern Territory regulator suspended its review deadline.
The Territory's Environment Protection Agency identified 10 potential impacts and expressed low confidence in mitigation, delaying a clear timetable for environmental assessment.
Project Ares, at 1GW capacity, and the proposed 2GW Beetaloo Energy project would total 3GW—roughly 10 times Northern Territory peak grid demand—intensifying regulatory and consultation challenges.

Environmental review delays project schedule

As reported by Reuters, Energy North says it is no longer working toward the June 28, 2028 "first power" date it listed in regulatory filings four months ago after the Northern Territory environment regulator suspended its seven-week deadline to determine what approvals the project must satisfy.

In an October 7 ruling, the regulator says it needs more time than usual to set environmental parameters and will seek advice from the federal government, which is developing policy expectations for data centres and AI infrastructure developers. The agency does not provide a new timetable for the next step in the assessment process.

Energy North vice president of project development Daniel Hunter says the earlier 2028 date was only indicative at the time of lodgement and that the company will confirm a revised timeline once the regulator sets terms for an environmental impact statement. Hunter declines to identify the project's financiers, while saying funding has been lined up.

The proposed Project Ares campus spans 191 square km and includes a gas turbine system, solar farm, airstrip and accommodation for 4,300 construction workers. The Territory's Environment Protection Agency warns of 10 potential impacts, including pressure on water systems and disruption to Aboriginal sacred sites, and says it has a low level of confidence in the effectiveness of proposed mitigation measures.

Broader implications for AI and energy ambitions

The setback highlights the gap between the Northern Territory's ambition to become a fast-track destination for AI investment and the practical hurdles facing large infrastructure proposals. The region is marketing its abundant land, high solar exposure and recently opened shale gas resources as advantages for developers seeking power-intensive data centre sites.

At 1 gigawatt, Project Ares is significantly larger than other Australian projects that have recently run into obstacles, including a delayed NextDC expansion in Melbourne and a Goodman proposal withdrawn in Sydney. Urban planner Adam Beck says planning systems were not built for projects of this scale, while adding that community concern is increasingly shaping outcomes on live developments.

The challenge extends beyond one project. Beetaloo Energy has proposed a separate data centre near Darwin that would be twice the size of Project Ares, and together the two developments would total about 3 gigawatts, roughly 10 times peak demand on the Territory's grid, although both companies say they plan to rely on combinations of renewables and their own gas-fired generation rather than the grid.

Consultation requirements are also adding complexity in a region where a quarter of the population is Indigenous. The Northern Land Council says meaningful Aboriginal consultation requires travel, interpreters and repeat visits, while the Northern Territory Cattlemen's Association says it supports development only with effective regulation that protects land, water and pastoral operations.

Our earlier coverage on the AI data center boom in the U.S. highlighted how many headline projects are being delayed or canceled as costs rise and funding becomes harder to secure. We noted that beyond financing stress, developers are increasingly running into power constraints and local/regulatory pushback, raising doubts about how quickly planned capacity can actually be delivered.

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