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ISSUE_05 / Does SA have the answer to solving the data centre conundrum?

16 June 2026

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Does SA have the answer to solving the data centre conundrum?

Data centres are the computational workhorses of the modern digital economy, but enormous amounts of energy and water are required to keep servers cool and systems running reliably.

In Australia, data centres are expected to use around six per cent of grid-supplied electricity by the end of the decade, up from two per cent today, according to Australia’s Energy Market Operator (AEMO).

In South Australia, scientists and engineers are spearheading innovation to ensure every prompt, scroll and swipe leaves a lighter touch on the planet.

“My dream would be to see one of the first demonstrations of ZBLAN fibre optic cable on Australian soil somewhere.”

– Professor Heike Ebendorff-Heidepriem, Deputy Director of the Institute for Photonics

A new way of delivering data

At the core of the nearly 1.5 million kilometres of sub-sea fibre-optic cables criss-crossing the globe are filaments made from silica glass that have been the backbone of the internet.

But it has limits. As light travels through the fibre it scatters and weakens, meaning signals must be boosted roughly every 100 kilometres via energy‑intensive and costly amplifiers that are powered by large cable landing stations, which is costly infrastructure to build and run – an escalating challenge as global data demands continue to surge.

Enter Adelaide University’s Professor Heike Ebendorff-Heidepriem, deputy director of the Institute for Photonics and Advanced Sensing (IPAS), who is leading the development of a novel fibre, ZBLAN, in partnership with its commercial partner Flawless Photonics Inc. The Australian National Fabrication Facility (ANFF) Optofab Hub is enabling this development with a world-class facility for glass and optical fibre manufacturing.

ZBLAN glass fibre has the potential to transmit light 20 times further than traditional silica-based cables with less energy and at lower costs, with the potential to revolutionise global internet connectivity.

“If ZBLAN works at its theoretical limit, amplifiers are only required every ~2000 km, which means that for shorter sub-sea cables no amplifiers are needed and hence no costly cable landing stations, so we can carry more data along the fibre with much less energy,” Prof Ebendorff-Heidepriem says.

“Data centres also contain many kilometres of optical fibre, so reducing signal loss can substantially lower demands and energy savings across the system.”

However, in contrast to the silica glass used for the manufacture of current optical fibres, ZBLAN glass is inherently susceptible to crystallisation during the fibre-drawing process, preventing the manufacture of ZBLAN fibres at the theoretical limit. The unwanted crystallisation is enhanced by the Earth’s gravity.

Taking manufacturing to space

The answer? Take manufacturing to space.

In 2024, Flawless Photonics took 20 ZBLAN pen-sized preform rods manufactured by the Optofab Adelaide team and their engineered compact fibre‑drawing module on the International Space Station, where these preforms rods were drawn by the compact fibre-drawing module to a world‑record 11.9 kilometres of ZBLAN fibre in micro-gravity.

Eight months of testing found that the space-drawn fibres experienced light losses ten times lower than the fibres drawn on Earth from the same set of preform and using the same type of compact fibre-drawing module.

Prof Heike Ebendorff-Heidepriem

“We now need to do more microgravity research to really pinpoint from a commercial perspective what will be the best process to manufacture ZBLAN fibre,” Prof Ebendorff-Heidepriem says.

“My dream would be to see one of the first demonstrations of ZBLAN fibre optic cable on Australian soil somewhere. It all fits into the R&D commercial landscape.”

ZBLAN’s name derives from its main components – Zirconium fluoride, Barium fluoride, Lanthanum fluoride, Aluminium fluoride and Sodium fluoride (chemical symbol NaF).

Selecting the right rig for the job

CoilRig Drill Rig

Alongside fibre-optic requirements, data centre growth is also driving unprecedented demand for efficient, low-emission cooling solutions, particularly in the US.

In 2023, data centres consumed 4.4 per cent of US electricity, with usage projected to rise to as high as 12 per cent by 2028, according to the US Department of Energy. In Australia data centres currently draw approximately two per cent of electricity grid but this could triple within five years, says the Australian Energy Market Operator.

The US government is also pushing data centre owners and tech giants to build their own power plants.

This is driving renewed interest in geothermal technologies that can reduce peak cooling loads and ease pressure on electricity grids.

Reducing high drilling costs will be critical to scaling geothermal heating and cooling as a strategic energy solution.

Adelaide-based CoilRig, located at Adelaide University, Mawson Lakes, says they have the answer with their purpose‑built coiled‑tubing geothermal drilling rig designed to dramatically reduce the cost, risk and time involved in drilling boreholes for geothermal heat‑pump installations.

“We’ve developed a new drilling rig for the shallow or low-temperature geothermal market, focused on ground source heat pump installation with the goal of making installation cheaper, faster and safer,” CoilRig Co-Founder and Director Soren Soe says.

“Ground source heat pumps are typically seen as a heating solution for residential and commercial buildings, but they’re just as effective as a cooling solution, particularly in energy-intensive environments like data centres.”

CoilRig’s system, designed and developed in Adelaide, unlike traditional rigs that require drill rods to be repeatedly connected and disconnected, uses a continuous coiled‑tubing drill pipe, enabling smoother, faster and measurably safer drilling.

“A pragmatic approach to sustainability is essential,” says Soren Soe. “Being ‘green’ is not enough on its own. Scalable sustainability delivers multiple benefits at once, lower emissions, healthier environments for occupants, and strong financial outcomes. That combination is what drives real market growth.”

Soe says Google, Meta and Microsoft are already exploring use of geothermal, while Australia’s uptake remains comparatively slow, with the Pawsey Supercomputing Research Centre in Western Australia, a pioneer in adoption this technology.

CoilRig has penetrated the US market earlier this year with its first rig sold to a New York drilling contractor achieving double the productivity with the CoilRig™.

“They have incentives in the US for geothermal which is something we don’t talk about in Australia at the moment, but the uptake for geothermal here needs to change and Australia is absolutely great for geothermal energy,” Soe says.

“Some more incentives or big demonstration projects of geothermal energy here in Australia would really take the industry forward.”

CoilRig progressed from R&D to full-scale commercialisation with the support of the State and Federal Governments.

As global demand for compute accelerates, the question isn’t whether the challenge can be solved, but whether South Australia’s blend of capability, ambition and innovation positions us closer to the answer.