NSW Planning Department Admits Mistake Over Data Centre Gas Plant Consultation

A major controversy has erupted over a proposed 675-megawatt gas-fired power plant in Moss Vale, which would power a data centre campus. The NSW planning department has admitted it failed to consult key agencies before setting assessment requirements for the project.

Planning Department Admits Mistake

The department provided a list of issues the developer was required to investigate before it could apply for an approval known as the Secretary's Environmental Assessment Requirements (SEARs) in December 2025. However, a community group then emailed the department asking whether agencies such as the NSW Environment Protection Authority (EPA) and Sydney Water had been consulted.

In a response, a senior planning official wrote that the department had asked the developer for more information, but had to issue the requirements "quickly and without consultation because the proponent threatened legal action".

Concerns Raised Over Planning Process

Greens MLC and planning spokesperson Sue Higginson said the revelation was "shocking". "That is massive cause for concern," she said. "The idea that all a corporation needs to do is threaten litigation and then get the response they need — that is a coercive move and if our planning system is so easily coerced, that indicates a deep, broad problem."

A Cloud Carrier spokesperson said in a statement that the SEARS process and consultation with agencies was "ultimately a matter for the department". "Any legal communications relating to aspects of the planning process are confidential and/or privileged," they said. "We do not intend to comment on those communications and do not waive any privilege attached to them."

Department to Consult Agencies Later

A DPHI spokesperson admitted the department had made a mistake. "In error, public authorities were not consulted before the SEARs were issued but they will be consulted during preparation of the Environmental Impact Statement (EIS) — and again, when the DA is lodged," the spokesperson said in a statement.

The spokesperson said the SEARs required the applicant to "consult with community, Wingecarribee Shire Council and relevant government agencies including the EPA when preparing the EIS". "If a development application and EIS is lodged, the proposal will undergo a rigorous all-of-government assessment, and the community will have the opportunity to have their say," they said.

Community Opposition

The proposal sparked a wave of opposition in the Southern Highlands. Ms Higginson said the drafting of SEARS with input from agencies was "a critical step" in the planning process. "This idea that we just consult the agencies later, it becomes quite a token process," she said. "This is why many communities across New South Wales are losing trust and losing faith in the planning system."

Minister Defends Government's Data Centre Planning

In a statement, Planning Minister Paul Scully defended the government’s data centre planning and said the power plant is at the earliest stages of the planning process.

Email Read in Parliament

An email was read to a Senate inquiry into AI and Data Centres by Jessica Ryall, a member of protest group Stop the Gas Plant, on Tuesday. "For this large, state-significant development, the EPA has not yet been consulted, Sydney Water hasn't been consulted, the gas company hasn't been consulted, council, Indigenous landholders, nobody," she told the inquiry. "That rule book was published by the department without any of those consultations."

Federal Government to Rule Out Fossil-Fuel-Powered Data Centres

The federal government has indicated it intends to rule out fossil-fuel-powered data centres in legislation to be introduced early next year. Last week Climate Change and Energy Minister Chris Bowen said "firming" gas power would be allowed, but data centres would need to "bring their own renewable energy". Last month the NSW government issued guidelines for data centres that offered faster processing times for projects powered by renewable energy.