The Albanese government is treating Australia's data centre boom, worth over $130 billion by the end of the decade, as a key driver that will help rescue the country's sluggish economy. However, the article argues this optimism is misplaced, as the actual economic payoff is likely to be far smaller than promised, with Australia positioned more as a passive "landlord" providing land, water and electricity than a genuine beneficiary of the AI revolution's profits, which will largely flow offshore to foreign tech giants.

Goldman Sachs estimates the construction boom will add just 0.3 percentage points to GDP growth before becoming a drag, amounting to roughly 1 per cent of GDP overall, compared with mining investment's peak of 7 per cent. Treasury estimates two-thirds of spending goes on imported servers and chips, with no clear export benefit afterwards, while the sector will strain resources already stretched by the housing crisis, push electricity demand up sevenfold to 34 terawatt-hours within a decade, and could see Sydney's data centres consuming up to 250 million litres of water daily by 2035.