Lessons from CIMIC Group’s global knowledge-sharing approach
Australia’s need for data centres is growing. Investors are eager for digital infrastructure opportunities, while data centre owners and operators require projects to come online quickly to meet demand from tenants and end users.
CIMIC Group is leveraging its global critical digital infrastructure capabilities to identify the strategic levers that enable data centres to be deployed at pace overseas. With experience constructing data centres in the US, Europe1 and Asia, CIMIC has identified best practices that Australian asset owners and developers can adopt to expedite project timelines.
Surging demand
Mass digitalisation has fueled demand for data centres the world over. As the backbone of the digital economy, Australian data centre storage capacity is forecast to increase by a factor
of 20 in coming years.2 Adding to demand is the fast adoption of artificial intelligence (AI), requiring roughly 2.5 times more
computing power than non-AI digital workloads.3
In terms of asset size, the global data centre market is projected to hit $263 billion, doubling operating capacity by 2027.4 According to Global Data, by late 2023 $15 billion had already been invested in Australian data centre projects. But there is far more to come. Australia’s technology sector is growing four times faster than the rest of the economy,5 and analysts suggest another 1500 megawatts (MW) will be required by 2030.6
“The market size and opportunity in the region are significant”, says Andrew Aliprandi, Senior Vice President Design, Engineering and Construction, APAC at Vantage Data Centres, a leading global provider of hyperscale data centre campuses. “Australia is well positioned with a highly developed market economy, a stable political environment, a robust supply chain, a variety of land options, and a well-established general contractor market. While cloud computing is more developed in EMEA and North America, many AI services don’t need the same connectivity and latency as cloud, which opens up a number of other potential locations, leading to the growth we’re seeing in Australia.”
AI is also driving data centres to become larger and more complex. “The scale of projects is growing enormously”, says Cathy Hayes, Head of Client Strategy, NSW and ACT at CIMIC’s CPB Contractors. “Our group started building 16 MW facilities in Asia, and now we’re rolling out 300 MW projects.”
Overcoming speed bumps
Speed is critical to meet the intensifying demand for complex critical facilities, meaning attention is being paid to sourcing available sites with sufficient power, and effectively managing planning approvals and the supply chain.
It is increasing demand for skilled resources, power, and strong supply chains. “We’ve seen demand for major plant and equipment quadruple”, says Aliprandi.
Chris Poiner, EGM Development at CIMIC’s Pacific Partnerships says navigating the market requires extensive experience in end-to-end delivery. “It is about having access to global experience in order to unlock the value creating potential of the next generation of infrastructure for our partners and for our company”, he says. “We also bring 2.5 gigawatts (GW) in operational and development renewables projects.”
As data centres grow, so too will their energy requirements. Morgan Stanley forecasts data centres will consume 8 to 15% of Australia’s national grid capacity by 2030, up from 5% today.7 Getting access to new, preferably renewable, energy is a focus.
“APAC is a highly sought-after region for many of our hyperscale customers”, says Aliprandi. “We are committed to reaching net zero carbon emissions globally for Scopes 1 and 2 by 2030,
which includes the procurement of renewable energy and designing our data centres to be as energy efficient as possible.
“UGL has deep connections with most of the electrical providers and distribution network providers nationally”, says UGL’s Matthew Olsson, General Manager of Transport Projects. “This means we can expedite the energy connection process.”
“In addition to getting access to power, using power as efficiently as possible is essential for operational performance, as well as minimising costs and carbon emissions”, says Hayes. “Understanding that a client wants a certain amount of energy distributed around the building per kilowatt is crucial.” Global tech giants have highlighted the challenge of reducing emissions at the same time as powering their AI innovations.8
“Building in renewable energy systems such as battery and solar power will help” says Olsson. “We work closely with renewable developers and see a great opportunity to bring the two markets together during the design phase.
Insights from Asia and the US
CIMIC’s Leighton Asia has made compelling efficiency gains by pre-fabricating mechanical and HVAC modules offsite for Malaysian and Indonesian data centres. In the US, Turner Construction Company, CIMIC’s sister company, reduces costs and speeds up construction through innovative supply chain procurement solutions and strategic offsite prefabrication.
“We’ve seen the benefit of having strong relationships in the supply chain”, says Hayes. “Those data centre clients that bring us in early to value engineer the design process have enjoyed efficiencies in layout, lighting, cooling and airflow management.”
Olsson says the Group’s global experience with different commercial models informs their Australian approach. “When we are engaged under early contractor involvement arrangements to scope, design and implement, we can provide constructability input to the design which results in a quicker and more efficient delivery process.”
CIMIC’s end-to-end offering – spanning finance, engineering, construction, offsite manufacturing, commissioning, operations and maintenance – drives project performance and reduces whole-of-life asset costs. “Our group-wide approach means we can connect clients with the latest thinking across all stages of a project lifecycle”, says Hayes.
CIMIC’s advanced technology leadership group shares expertise from data centres worldwide. “We’ve been able to expedite procurement and leverage more sustainable energy and water efficiency innovations from the learnings shared between our US and Asian data centre developments”, says Hayes. “By transferring best practices, we can speed up the rollout of Australian data centres. This is a powerful lever for driving delivery certainty and market speed.”
CIMIC Group is at the forefront of data centre construction globally. Turner Construction Company, CIMIC’s sister company, is a leading data centre builder in the United States, delivering US$14 billion in projects at 4700 MW operating capacity in the past five years.
Leighton Asia builds data centres across the region, delivering bespoke facilities for industry leaders.
In Australia, CPB Contractors and UGL combine to expedite construction. The Group is investing in next-generation infrastructure through Pacific Partnerships to strengthen Australia’s digital economy.
- Via Turner and HOCHTIEF
- BDO, A-REIT Survey, 2023
- JLL, Data Centers 2024 Global Outlook
- Global Data, Beyond Bites: data center evolution for peak performance, Innovation Radar, April 2024 and S&P Global Market Intelligence, March 2024
- Australian Trade and Investment Commission, Digital Technology Report, 2023
- Carl Kitchen, Data Centres and Energy Demand – What’s Needed?, 27 June 2024, Australian Energy Council
- Carl Kitchen, Data Centres and Energy Demand – What’s Needed?, 27 June 2024, Australian Energy Council
- Financial Times, Google emissions jump nearly 50% over five years as AI use surges, 2 July 2024