Strategy Behind Keppel’s 720MW Hazelwood Data Centre Campus

Keppel is advancing plans for a 720MW data centre campus near the site of Victoria’s former Hazelwood power station in Australia, with legal adviser Allens supporting the transaction across structuring, power and regulatory matters.

The proposed development will occupy a 123-hectare site strategically positioned within the Gippsland Renewable Energy Zone, one of the state’s key electricity nodes. Proximity to major transmission infrastructure is increasingly central to unlocking large-scale capacity for data centre operators.

Keppel, headquartered in Singapore, is a global asset manager and operator with sustainability-focused capabilities across infrastructure, real estate and digital connectivity.

The company operates more than 39 data centres across Asia-Pacific and Europe, and the Hazelwood proposal would mark a significant expansion of its footprint in Australia.

Leveraging grid and fibre access

The campus location offers potential for a dedicated transmission connection to neighbouring power terminal stations. Access to established electricity infrastructure at one of Victoria’s largest grid nodes could support high-capacity deployments while reducing the complexity of new network build-out.

In addition to grid connectivity, the site provides access to existing water infrastructure and intercity dark fibre networks – both critical components for hyperscale and AI-focused data centres.

As AI and high performance computing workloads drive up rack densities and overall campus loads, developers are looking for sites capable of supporting hundreds of megawatts with secure grid connections and scalable network capacity. A 720MW campus would place the Hazelwood project among the largest proposed data centre developments in Australia.

Allens advised Keppel on all aspects of the transaction, including structuring, securing development and acquisition rights, power and network connection, FIRB approvals, financing and competition considerations. The firm also worked with Keppel’s Singapore counsel on regulatory compliance matters.

Positioning Victoria for AI scale compute

David McLeish, Lead Partner at Allens, highlights the scale of the opportunity. 

“This project represents a transformational opportunity for Australia's digital and AI infrastructure landscape,” he says.

David noted that developments of this magnitude have the potential to shift the geography of compute capacity within Australia, particularly as demand for AI infrastructure accelerates.

“We are pleased to support Keppel on a development of this scale, which positions Victoria as a leading hub for next-generation compute capacity,” he adds.

The Hazelwood site sits within a region undergoing energy transition, as former coal generation assets give way to renewable energy development. Its inclusion in the Gippsland Renewable Energy Zone suggests potential alignment between large-scale data centre demand and emerging renewable generation projects.

For operators, co-location with renewable energy zones can offer advantages in long-term power procurement strategies, including the potential for direct or near-direct connections to new generation assets.

Building on digital infrastructure expertise

The mandate builds on Allens’ track record in data centre and broader digital infrastructure transactions.

The firm has previously advised CPP Investments, as part of the Blackstone consortium, on the A$24bn (US$17.1bn) acquisition of AirTrunk, Global Switch on the A$2.12bn (US$1.5bn) sale of its Australian data centre operations, Macquarie Technology on planning approval, development and leasing of its data centres, and Stockland on its A$2bn (US$1.41bn) M Park innovation precinct including a data centre component.

For Keppel, the proposed 720MW campus would expand its global portfolio at a time when hyperscale and AI customers are seeking large contiguous blocks of capacity.

If progressed, the Hazelwood development would contribute substantial new supply to Australia’s digital infrastructure market, anchored by direct access to transmission, water and fibre networks in a designated renewable energy zone.