National Party Demands Data Centers Bring Their Own Power Generation
New Zealand's National Party has proposed a policy that requires data center developers to bring their own power generation, rather than relying on the existing grid. This move is part of the party's 'Electrify NZ 2.0' package, aimed at preventing AI-driven data centers from driving up electricity costs for households and businesses.
The policy, which would take effect in October 2026, requires developers to finance or arrange new generation capacity alongside their projects, with a focus on renewable sources. This is known as 'additionality.' Firmed power supply, which can be relied upon consistently, will be the standard.
Data centers currently account for around 0.6% of New Zealand's electricity consumption, but this share is projected to climb to 3% by 2030. Some individual projects are massive, with Datagrid planning a 280 MW campus near Invercargill that could exceed the power consumption of the Tiwai Point aluminium smelter.
National Party spokesperson Simeon Brown and Prime Minister Christopher Luxon have stated that existing market arrangements would fit within the framework, including power purchase agreements with generators such as Mercury Energy. This approach is not unique to National; Labour and the Greens are also proposing similar policies, but with some differences in detail.
The policy aims to attract between $25 billion and $35 billion in AI infrastructure investment while supporting New Zealand's renewable energy sector. For data center developers, this means securing power would become a precondition for projects, rather than just a line item. Generators stand to benefit from long-dated, creditworthy buyers, while households and businesses may see protection from price hikes.