Datagrid Signs Power Supply Deal with Mercury for Planned 280MW Data Center Campus in Invercargill, New Zealand

Why It Matters

The agreement anchors a major renewable‑energy‑backed AI hub in New Zealand, giving hyperscale providers a stable, low‑carbon compute location and boosting the nation’s digital economy.

Key Takeaways

• 140 MW power deal secures 15‑year renewable supply
• First AI‑focused data centre in New Zealand slated for 2028
• PUE target below 1.1 leverages natural cooling
• Tasman Ring Network will add 540 Tbps subsea capacity
• Project promises NZD 70 bn economic boost

Pulse Analysis

The global race to host hyperscale artificial‑intelligence workloads is reshaping data‑center geography. Operators are chasing sites that combine abundant, low‑cost power with climate advantages that reduce cooling expenses. New Zealand’s South Island offers a unique mix: a fully renewable electricity grid, cool maritime temperatures, and relative isolation from geopolitical risk, and robust fiber networks. Datagrid’s planned 280 MW “AI factory” in Invercargill taps these attributes, positioning the campus as a low‑carbon compute hub that can compete with established locations in the United States and Europe.

The 15‑year, 140 MW Power Purchase Option Agreement with Mercury locks in roughly 1.2 TWh of renewable electricity each year, giving Datagrid price certainty and a carbon‑neutral supply chain. Mercury’s portfolio—hydro, geothermal and wind—means the power will be sourced entirely from clean generation, aligning with the campus’s ambitious PUE target of below 1.1. For hyperscale customers, such long‑term, green contracts reduce operational risk and simplify compliance with increasingly strict ESG mandates, making the Invercargill site an attractive option for AI and cloud providers, and future‑proof scalability.

Beyond power, Datagrid is bolstering connectivity through the Tasman Ring Network, a 6,000 km subsea cable slated for 2027 that will deliver 540 Tbps between New Zealand’s main islands and Australia’s major data hubs. This high‑capacity link mitigates reliance on North Island landing points and opens direct pathways to Sydney and Melbourne, enhancing latency‑sensitive AI workloads. Combined with the renewable‑rich site, the infrastructure promises a NZD 70 bn economic uplift, signaling New Zealand’s emergence as a strategic, low‑carbon AI infrastructure destination in the Asia‑Pacific, for regional digital sovereignty.