What did AWS and Greater Western Water announce?

Greater Western Water and Amazon Web Services agreed to supply a new AWS data centre in western Melbourne with recycled water from the Melton Recycled Water Plant, for cooling, connected from the first day of operations. GWW says it is expected to be the first such connection to a data centre in Victoria, and AWS says it is its first in Australia. The arrangement shifts the facility’s cooling demand off the drinking-water network and onto recycled supply.

Why do data centres use recycled water?

Cooling servers takes large volumes of water or electricity, and many systems use water directly. Drawing that water from recycled, non-potable supply rather than the drinking-water network eases pressure on town water, which matters most in fast-growing, drying regions like western Melbourne. AWS says the Melton connection will preserve millions of litres of drinking water a year, depending on the facility’s final size and cooling design.

How much water do data centres use in Australia?

About 5.5 gigalitres a year nationally, roughly 0.04% of Australia’s mains water and well below manufacturing’s 235 gigalitres, according to CSIRO’s submission to the NSW data centre inquiry citing the ABS Water Account Australia. Use per facility varies with cooling design: CDC reports near-zero operational water from closed-loop cooling, while evaporative-cooled sites draw more. AWS has not disclosed its western Melbourne facility’s water volume, so the specific saving cannot yet be quantified.

How does this fit Australian data centre water policy?

Water stewardship is one of five points in the Australian Government’s Expectations of data centre and AI infrastructure developers, released under the National AI Plan in March 2026. At state level, the deal follows Victoria’s new Industry Water Connection Guide, which sets out how large industrial users connect to the state’s water system. The Melton connection is an early example of meeting both on a specific site.

AWS will cool its western Melbourne data centre with recycled water in a Victorian first

At a glance

Greater Western Water (GWW) and Amazon Web Services have agreed to supply a new AWS data centre in western Melbourne with recycled water from the Melton Recycled Water Plant, for cooling, connected from the first day of operations.
GWW says it is expected to be the first such connection to a data centre in Victoria, and AWS says it is its first in Australia.
Across Australia, data centres use about 5.5 gigalitres of mains water a year, roughly 0.04% of the national total and well below manufacturing’s 235 gigalitres, per CSIRO’s submission to the NSW data centre inquiry. The connection shifts even that small draw off drinking water.
The deal follows Victoria’s new Industry Water Connection Guide. AWS says it will preserve millions of litres of drinking water a year and counts toward its goal to be water positive by 2030.
GWW will begin a A$70 million Melton upgrade in 2027, built by Guidera O’Connor, to lift recycled-water capacity and quality across one of Australia’s fastest-growing corridors.

What Greater Western Water and AWS agreed

GWW and AWS will connect a new AWS data centre in Melbourne’s west to recycled water from the Melton Recycled Water Plant, used for cooling from the first day of operations rather than switching over later. GWW expects it to be the first such connection to a data centre in Victoria; AWS says it is its first in Australia.

“Planning for the water needs of data centres is part of Greater Western Water’s responsibility to deliver reliable, affordable water services for its customers now and into the future, especially as the region grows and the climate dries,” said managing director Cameron FitzGerald. AWS’s Matt O’Rourke, head of infrastructure and energy policy for Australia and New Zealand, said connecting to the Melton plant “will help preserve millions of litres of drinking water annually for local communities,” counting toward the company’s goal to be water positive by 2030. Those are AWS’s figures, and the saving will depend on the facility’s size and water volume, which it has not disclosed.

O’Rourke said AWS’s Melbourne data centres use free-air cooling for about 96% of the year, with no water, switching to evaporative cooling that uses and reuses water only in the hottest conditions. The recycled connection mainly covers peak-summer demand, when pressure on the drinking-water network would otherwise be highest.

Why recycled water, and why now

Western Melbourne is one of the country’s fastest-growing corridors, and Victoria’s planners are weighing a drying climate against rising demand. A large new user drawing cooling water from the drinking-water network adds to that pressure; drawing it from recycled supply does not. The pattern echoes the energy side of the buildout, where data centre load is helping fund the renewables and grid upgrades behind falling power bills rather than simply drawing on existing supply.

The deal also lands on Victoria’s new Industry Water Connection Guide, released shortly before the announcement, which sets out how large users connect to the state’s water system. Water stewardship is one of the five points in the Australian Government’s Expectations of data centre and AI infrastructure developers under the National AI Plan; the Melton connection is a worked example of meeting it on a specific site.

Where the AWS deal sits in the Australian market

Data centres are a small share of national water use. In its submission to the NSW data centre inquiry, CSIRO put data centre use at about 5.5 gigalitres of mains water, 0.04% of the national distributed total and forecast to reach 17 gigalitres by 2030, against roughly 235 gigalitres for manufacturing. The draw is small but concentrated in a few fast-growing catchments, which makes the source of the water, not just the volume, the planners’ question. CSIRO itself backs prioritising recycled and non-potable water for new data centres, the principle Melton applies.

Water is nonetheless a flashpoint. In Sydney, reporting on approvals and projected draws has fed community concern, though the headline numbers are contested: the most-cited projection, reported by Reuters in 2025, rests on an “accessible water” figure Reuters noted was undefined. AWS also faces disclosure criticism, that it reports on-site water but not the water embedded in its electricity. The Melton arrangement, by contrast, names a specific source and a day-one commitment before the facility is built.

It also sits within an established direction. CDC runs closed-loop cooling it reports uses almost no operational water, a water usage effectiveness (WUE) of 0.01 litres per kilowatt-hour, an approach the National AI Plan singled out. AirTrunk reports drawing 53% of its portfolio water from recycled sources in FY24, with EY limited assurance, and AWS reports a global 0.12 litres per kilowatt-hour for 2025, noting methods vary between operators. The Melton deal adds a supply route in a market where the larger operators already cut or recycle water, complementing demand-side design such as the water-efficient cooling at GreenSquareDC’s SYD1 campus in western Sydney.

Operator	Reported WUE (L/kWh)	Water approach
CDC	0.01	Closed-loop cooling since 2007; reports about 5 gigalitres a year saved across 16 campuses
AirTrunk	0.97 (FY24)	53% of portfolio water from recycled sources; EY limited assurance
AWS	0.12 (global, 2025)	Targets water positive by 2030; western Melbourne site to run on recycled water
NEXTDC	2.25 (FY25)	773 megalitres of water in FY25; higher where evaporative cooling is used

Source: Certified Strategic Editorial, operator sustainability reports and the Water Services Association of Australia, FY24-FY25. WUE is litres of water per kilowatt-hour, where lower is better. Figures are operator-reported and use different boundaries, so they indicate approach more than a strict ranking.

A model the sector wants to repeat

Data Centres Australia called it a template. “Many of our members have been pushing to move to non-potable water sources, so it is pleasing to see this breakthrough in Victoria, and we hope it is the first of many such announcements,” said chief executive Belinda Dennett.

Water utilities want the business. The Water Services Association of Australia told the inquiry the sector would “support and enable” data centre expansion and “welcome them as customers,” naming recycled water a preferred pathway. It also expects drinking water to be used initially while large recycled networks are built, which is what makes Melton’s day-one connection to an existing plant notable. The Property Council said “many proponents are already investing in water-efficient designs, alternative cooling systems and non-potable water sources,” but need “clearer and more consistent approval pathways.” Victoria’s Guide is one answer, and the Melton deal follows its release as an early test of it.

GWW is inviting others to follow, with a fallback for sites where a direct pipe is not feasible: large users “contributing to recycled water projects elsewhere in the catchment.” Western Melbourne carries a heavy share of the national pipeline, part of why Melbourne is pulling ahead of Sydney on capacity, and the same corridors are where water supply is tightest. A model other operators and water corporations can copy is worth more than one hyperscaler’s headline, the same logic now shaping the energy side, where regulators and operators are aligning on planning new supply in from the start.

What it means for GWW and AWS

The connection has infrastructure behind it. GWW’s A$70 million Melton upgrade, built by Guidera O’Connor from 2027, will let it serve more large users than the AWS site alone, and signals it expects non-potable demand to keep rising. For AWS, which has committed A$20 billion to its Australian buildout, the link extends a water-stewardship position; for GWW, it is an early test of Victoria’s new connection guidance. Our directory tracks AI data centre locations across Australia as new capacity and its resource commitments are disclosed.