South Africa's Data Centre Transparency Requirements: A Growing Concern

• South Africa's data centre capacity is set to increase significantly, with new facilities planned that could more than double national power demand.
• Data centres can consume vast quantities of electricity and water, putting pressure on already scarce resources in South Africa.
• Other countries are taking a proactive approach to regulating data centre development, with some imposing moratoriums or requiring new facilities to meet renewable energy requirements.

Digital information hosted on South African soil is subject to South African law: to the Protection of Personal Information Act (POPIA), the Information Regulator, and our courts.

South Africa's data centre capacity is set to increase significantly, with new facilities being planned that could more than double the sector's national power demand. This expansion has sparked concerns about the impact of data centres on human rights and the environment. However, proponents argue that data centres can be a valuable asset for the country, enabling digital information hosted on South African soil to be subject to local law and regulation. The Protection of Personal Information Act (POPIA) and the Information Regulator play a crucial role in ensuring that data centres comply with South African regulations.

Despite the benefits of data centres, there are risks associated with inadequate transparency and community benefit agreements. Data centres can consume vast quantities of electricity and water, putting pressure on already scarce resources in South Africa. Municipalities and Eskom have been evasive about disclosing information about existing data centre consumption, citing privacy protections under POPIA. This lack of transparency raises concerns about the potential costs to ordinary South Africans if data centres are not developed sustainably.

Other countries are taking a proactive approach to regulating data centre development, with some imposing moratoriums or requiring new facilities to meet renewable energy requirements. For example, New York has become the first US state to impose a statewide moratorium on new hyperscale data centres while it builds a proper environmental review framework. New York Governor Kathy Hochul signed Executive Order No. 62 on July 14, 2026, establishing this moratorium, which temporarily pauses state environmental permits for one year for data centers consuming 50 megawatts or more of energy, pending the development of a regulatory framework and completion of a Generic Environmental Impact Statement. In Ireland, new data centres must bring their own generation and storage, meet renewable energy requirements, and support local communities. These examples highlight the importance of having a robust regulatory framework in place to ensure that data centre development is sustainable and benefits local communities.

Lawyers and compliance officers should watch for the potential risks of data centre development in South Africa, including non-compliance with POPIA and the costs associated with inadequate transparency and community benefit agreements.

Source: Original reporting via [Source]