The eThekwini Municipality has voted to sign a legally binding memorandum of agreement with a South Korean power consortium to explore the development of a major AI data center south of Durban, brushing aside calls from opposition councillors for greater transparency before committing to the deal.
According to an official report to the city’s economic development and planning committee, the proposed facility could cost between $3 billion and $10 billion under a public-private structure in which the city would provide land and infrastructure while the South Korean consortium would fund construction and operational costs. The briefing document suggests the center could be operational in the 2027-2028 financial year.
The proposed 5-hectare development site is located at the mouth of the Lovu River near Amanzimtoti, close to the Amanzimtoti Cable Landing Station, which is connected to the 45,000-kilometer 2Africa submarine cable system linking Africa to Europe, the Middle East and India.
Buried within the city’s seven-page briefing document are two references to a data center capacity of 400 megawatts — a figure that, if confirmed, would make it the largest data center in South Africa and would represent the equivalent of one-quarter of eThekwini’s current total electricity supply of around 1,600 megawatts. The city has declined to confirm the figure, stating that “any figures currently circulating publicly, including specific megawatt estimates, should not be regarded as confirmed project specifications.”
The briefing document makes a brief reference to supplying electricity from “existing renewable energy resources in possession of the proposed development partner,” but neither the city nor the Korean consortium has provided details on the location of those resources or how supply fluctuations from wind or solar would be managed given data centers’ need for continuous 24-hour power.
Questions about water supply are similarly unresolved. The only reference to cooling water in the document is a single line noting that the proximity of the Umsimbazi River “presents an opportunity for alternative water supply” — though the project site is depicted on the Lovu River, approximately 2 kilometers away. The reference to “alternative” supply suggests eThekwini may serve as the primary supplier of large volumes of potable water for cooling. According to the U.S.-based Environmental and Energy Study Institute, large data centers can consume up to 19 million liters of water per day, equivalent to the daily water use of a town of 10,000 to 50,000 people.
Senior Democratic Alliance councillor Andre Beetge said his party would abstain from supporting the agreement until there was full transparency on the project’s energy and water demands, environmental implications, local economic participation and public consultation. “At first glance, the proposal sounds almost too good to be true,” Beetge said, noting that the project promises capital investment of up to $10 billion, up to 5,000 temporary construction jobs and up to 500 permanent positions.
Beetge also raised broader regulatory concerns. “Why is there no similar regulatory framework referenced in this proposal?” he said, noting that countries in the European Union are adopting stricter energy-efficiency rules in response to global AI infrastructure expansion. “One is left to question whether Africa is again being viewed as a jurisdiction with comparatively less stringent regulatory oversight — a convenient destination for energy-intensive infrastructure that may face stricter scrutiny elsewhere.”
In its response, the city emphasized that the council’s approval is strictly limited to entering a memorandum of agreement for exploratory and feasibility purposes and does not constitute approval of the project itself, any infrastructure commitments, financial contributions or regulatory authorizations. “Any future steps will be informed by feasibility outcomes and will follow all required statutory processes,” the city said.
The Korea Southern Power Company is believed to be part of the consortium driving the proposal. The company did not respond to requests for comment.
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