At a glance
Data centre load reverses the fall in the grid's quietest hour from about 2029, a year after the same report had it reaching zero in the early 2030s.
Transgrid now has data centres at 66% of all growth in New South Wales electricity use between the 2026 and 2035 financial years.
They reach 20% of the state's summer peak by 2035, up from about 3%, and draw around 3.5GW at that peak.
The consultancy behind the number puts it at roughly twice the equivalent in AEMO's August forecast, using a conversion it has not published.
Transgrid is also pushing for legislation that would make data centres invest in generation equal to what they draw.
Transgrid, which owns and runs the high-voltage transmission network across New South Wales and the ACT, published its 2026 Transmission Annual Planning Report on 10 September 2026. The report sets out what the company expects the state's electricity system to need over the coming decade, and it says the demand assumptions behind that planning have been rewritten. Hyperscale data centres are the change it names first.
The 2025 edition of this report forecast zero minimum demand in New South Wales by the early 2030s, meaning the grid emptying out at its quietest hour. The 2026 edition has that low point turning back up from around 2029, and the reason it gives is data centre load.
Inside twelve months a steady industrial draw has moved from a strain on the system to the thing that steadies it. Transgrid has also written data centres in as the largest single source of new electricity demand in the state, at 66% of all growth in end-use consumption between the 2026 and 2035 financial years. The harder question the report leaves open is whose number to plan against: Transgrid's runs at roughly double the national market operator's, and what connects the two is a conversion performed by the consultancy Transgrid commissioned.
Data centre load outpaces rooftop solar from about 2029
Minimum demand is the lowest point total grid draw falls to, usually on a mild sunny day when rooftop solar is supplying homes directly and the network sees very little of them. Transgrid's 2025 report put the zero forecast on its own summary page, alongside a 44% drop in forecast minimum demand within two years, and set out why that is a problem rather than an achievement: low minimum demand "can challenge the voltage profile and stability of the power system", and it was falling "faster than expected with serious implications for grid management".
Transgrid now has that decline reversing by around 2029, although not before minimum demand falls below 2,000MW. A data centre draws much the same power at noon as at midnight, so it keeps pulling through the middle of the day when household solar is pushing everything else down. Transgrid's foreword puts the race in a line: household rooftop generation "will be dramatically outpaced by growth in data centre demand". The report pairs the reversal with 6GW of additional rooftop solar and 7GWh of household batteries over the same period, so both trends keep running and one overtakes the other.
The same round-the-clock draw carries the consumer argument. Where data centres fund the infrastructure they need, the report says, "their additional demand can benefit consumers by improving network utilisation and spreading largely fixed costs across a broader customer base". That is the network component of a household power bill, the part set by what it costs to build and run the wires, and it is the part that can fall. Transgrid has separately argued that data centres should fund the grid capacity they unlock, and the report says data centre proponents have indicated support for that approach.
Transgrid quadrupled the forecast it published in August 2025
Transgrid published its previous report on 19 August 2025, forecasting at least 800MW of additional data centre load in New South Wales by 2035. The 2026 edition states the revision plainly: "We now project data centre loads to be approximately four times higher in 10 years than forecast in the 2025 report."
Data centres reach 20% of the state's summer maximum demand by 2035, from around 3% now, and draw about 3.5GW at that moment. Transgrid's projection has summer maximum demand itself climbing through the 2030s, so the share and the megawatts rise together.
Rated capacity, meaning the connection size a site is built to rather than what it draws on the day, runs higher again and further out. On the same central case it rises from about 720MW across New South Wales in 2026 to 6,700MW by 2040. Sites already operating carry 1,180MW of that, so the rest comes from projects yet to be built.
Baringa screened about 20GW of enquiries down to 3.5GW
Baringa Partners, a consultancy Transgrid commissioned, built the forecast with the distribution networks Ausgrid, Endeavour Energy and Evoenergy. Its method pools the connection data each network holds, then discounts it for how likely a project is to proceed, how fast it fills once built, and how often the same project appears on two networks' books. Transgrid adopted Baringa's central case with what it calls minor adjustments, and Baringa's small existing and committed sites were left out.
Transgrid had received about 20GW of connection enquiries over two years, and by July 2026 had signed agreements representing 1.5GW in Greater Sydney. The forecast built on top of that sits at 3.5GW. Its own report says some enquiries are speculative or counted twice across networks, which is the screen at the centre of the phantom demand question.
Transgrid names both sides of what that load does once connected. A stable data centre draw "has positive consequences, such as enabling more use of solar power", the report says, and "it also means that data centres will raise peak demand considerably unless appropriate flexibility or on-site generation is available". The company assesses applications against conservative peak assumptions and writes curtailment and ride-through terms into its connection agreements.
AEMO's forecast is half as large, on Baringa's conversion
The Australian Energy Market Operator, which runs the national electricity market and plans alongside Transgrid, published its own outlook on 25 August 2026. Under its Step Change scenario, the case AEMO treats as central, data centre consumption reaches around 34TWh by the 2036 financial year, up from about 5TWh. That is 13% of forecast operational consumption. New South Wales took 66% of data centre electricity use across the national market in the 2026 financial year, ahead of Victoria on 30%, which tracks where the data centres in Australia already operate.
AEMO counts 225 data centres in development carrying 67GW of combined capacity, then discounts that pipeline against three things.
AEMO's screen | What it applies |
|---|---|
Project completion | 36% of the developing projects in the 2025 outlook were cancelled |
Grid connection use | Connections running at about 27% of capacity across the 2026 financial year |
Load maturity | Five to ten years for a site to reach full draw |
Source: AEMO, Forecasting growing data centre demand, 2026 Electricity Statement of Opportunities, 25 August 2026.
AEMO publishes energy across a year for the whole market, Transgrid publishes megawatts at one state's busiest moment, and the 9GW inside AEMO's own connection process is a third measure again. The comparison between them belongs to Baringa, which "estimates this is approximately two times the equivalent peak demand represented in AEMO's 2026 ESOO Step Change scenario, which Baringa derived by converting AEMO's published energy forecasts into peak demand using its assumptions".
Those assumptions carry the result, because turning a yearly energy total into a peak figure requires a view on what share of the year a fleet of data centres runs at full load. AEMO's own utilisation reading of about 27% and its five-to-ten-year maturity range both say that share is still moving.
Transgrid wants generation matched to demand in law
Transgrid says it is working with AEMO to improve forecast alignment, and the reason it gives is commercial: differences between forecasts "may create uncertainty for renewable generation developers and weaken investment signals". New South Wales is already asking data centres to sign long contracts with wind and solar farms that have not yet been built, in exchange for a faster planning assessment, so what generation developers believe about demand bears directly on whether anyone signs.
The report goes further than the deal the state is offering. Transgrid says it is "advocating for new legislation to ensure data centres invest in generation equivalent to their demand", which it calls an important requirement to prevent unnecessary increases in wholesale power prices. A voluntary trade for faster planning and a legislated matching obligation are different instruments, and the second one reaches every project rather than the ones that opt in.
The report maps where large loads can connect
Existing capacity within the Sydney region is now largely committed, in the report's words, and proponents seeking to connect there have been told they will need to fund local upgrades and contribute to larger works upstream. Sharon AI's purchase of a closed Albury paper mill, reported on 9 September 2026, sits inside that pattern, at the Victorian border and a long way from Sydney.
The report carries a map of indicative large-load hosting capacity across the state, marking the Wagga, Yass and Marulan areas in the south, the Hunter and Newcastle in the north east, and Wallerawang and Dumaresq further out. Its bands run from half a gigawatt to two, and it is drawn twice: once as at August 2026, and again for 2030 once HumeLink and the Hunter Transmission Project are delivered. Transgrid attaches a caveat of its own, that the map shows network capacity and "does not account for availability of generation". The Connection Opportunities Portal carries the same data at substation level, updated in September 2026, behind a registration form.
Two documents govern what a developer does with that map. Transgrid's data centre connection rules give a project three months from signing to produce its planning consent, land, construction contracts, equipment orders and financing before its capacity allocation can lapse. The NSW data centre guidelines, which Transgrid says its position is aligned with, set what the state wants in return for the faster assessment.
What to watch
Baringa's conversion. The report publishes the two-times comparison and keeps the arithmetic under it in house. Whether that working reaches the next planning report, or a rule-change submission to the Australian Energy Market Commission, decides whether anyone outside the two planning bodies can audit a gap this wide.
AEMO's 2027 outlook. Its cancellation rate is the one published measure of how much of the national pipeline converts, and a second reading turns it into a series.
The 2029 reversal. A transmission planner has put a date on when large steady load starts holding the grid's low point up rather than pushing it down. The minimum demand readings between now and then are the test.
The first regional signature. The map marks capacity around Wagga and the Hunter, and the 1.5GW Transgrid has signed sits in Greater Sydney. Transgrid says those regions become comparable to Sydney once HumeLink and the Hunter Transmission Project are delivered, which puts the question to any AI data centre developer weighing a wait against a metropolitan site.