Look at the cloud from both sides

To have your head in the clouds used to be a bad thing. It meant your thinking was impractical.

But there’s nothing impractical or insubstantial about the extent to which modern communications relies on cloud-based computer services and data storage facilities.

Southland seriously needs to get its head around the implications of the $1 billion-plus project to create a green data storage hub on land near Makarewa, providing computing services for Australia, New Zealand and beyond.

Helmed by Datagrid, the project entails significant players, seriously resourced. The question of what it will deliver to the regional and national economy, and what it will demand from it, is itself a weighty matter.

The 43ha site has been acquired and that in itself won’t pass without comment from the many who lament the loss of productive farmland nationwide.

But the data plant has two great needs, one of which – a chilled-out climate that substantially reduces the really big cooling costs for such facilities – the province is well-placed to provide. Feel free to insert your own climate-change caveat here, should you wish, but Southland’s comparative advantage is unlikely to change.

The other abiding need is electricity, reliably and virtuously provided. This is a key asset, albeit that the punters of Southland aren’t in a position to control its destiny..

The plant will seek to consume up to 150 megawatts of power, more than a quarter of the quantity the Tiwai Point smelter currently uses. Meridian Energy says it could supply 100 megawatts regardless of whether the smelter remains open.

The point won’t be lost on many that this is not the only project seeking to use great quantities of Manapouri power locally; the green hydrogen option also stands tall in the thinking of the developmentally minded.

Although the construction workforce would be substantial at between 800 and 1200 workers, the number of staff needed to keep it running is being put at between 25 and 70.

But just as Tiwai itself has significance far beyond the ranks of smelter employees, there’s potentially scope for Southland’s hub status, particularly given the related provision of the Hawaiki Nui subsea cable network, to attract other IT business and the attendant expertise.

From the earliest days of the data centre proposal it was held to be a real advantage that apart from the electricity capabilities and climate advantage, New Zealand had attractive qualities for the international market in its long term political stability and welleducated workforce.

This was mitigated, however, by a lack of international connectivity , which was offset by the provision of the first Hawaiki Cable, a transpacific system linking us to the Pacific Islands, Australia, Hawaii and mainland United States. This second Hawaiki Nui cable offers tech businesses a strong connection to eastern Australia and the west coast of the US. There’s scope here for high-value jobs and a more diversified economy.

Yet there will be sceptics and much of what they have to say will be about the opportunity cost – what else might be better options.

The fact remains that the data centre is progressing towards planning consent and the welcoming noises are coming in strong. Whether or not the data centre is something that should have us on Cloud 9, it’s nowhere near the cloud cuckoo land.

Proponents and opponents need to step forward.

. . . there’s potentially scope for Southland’s hub status . . .