The eThekwini Municipality addressed concerns raised about the Korea South Power Consortium’s development of an artificial intelligence (AI) Data Centre in Amanzimtoti.
This follows concerns raised by Andre Beetge, DA eThekwini Exco member and Ward 97 councillor, about the Memorandum of Agreement (MOA) the municipality will sign with the consortium.
Beetge said that municipal councillors only became aware of the MOA when it appeared on the committee agenda two days before the February 26, 2026 council meeting.
“At first glance, the proposal sounds almost too good to be true. The capital investment, jobs, and a global technology footprint for eThekwini. But beyond the headline figures, the details are conspicuously absent. There is no clarity on who precisely will benefit from the employment opportunities,” he said.
Beetge said that Asian-owned technology entities historically rely heavily on imported specialist labour, often limiting meaningful local economic participation.
“The report further fails to contextualise that the Korea South consortium has reportedly set out to establish 76 such facilities globally by 2028. Nor does it adequately address the energy demand trajectory associated with AI data centres — projected to escalate dramatically over the next few years, with global AI-related power consumption rising from approximately 415 terawatt hours in 2024 to an estimated 945 terawatt hours by 2030.”
Beetge added that the municipality was grappling with an unstable electricity supply and significant water losses of over 50%.
“You have just reprioritised funding away from the Kingsburgh substation upgrade. How can we responsibly commit to a project of this magnitude without first stabilising core infrastructure? The proposed site itself raises further concerns. It is located within a D’MOSS sensitive environmental area, in proximity to the ocean,” Beetge warned.
Beetge also sought clarity on:
- Building materials suitable for corrosive coastal conditions.
- Impact on the adjacent railway line.
- Impact on neighbouring private properties.
- Environmental mitigation measures.
- Water consumption requirements.
He was also concerned about:
- Energy and water impacts are undefined,
- Environmental implications are unclear,
- Local economic participation is not guaranteed, and
- Public participation has not yet taken place.
The municipality stated that the centre is expected to cost the consortium between $3 million and $10 million.
It will provide the land and infrastructure for development, while the developer is expected to cover the costs of the building and operations.
“The municipality’s Economic Development and Planning Committee report stated that a development of this nature would complement and strengthen existing local smart city initiatives, including traffic optimisation, transport analytics, energy management, and data-driven municipal planning,” he said.
However, the municipality stated that the MOA creates a structured framework for engagement with the prospective investor to assess the feasibility of the proposal.
“Such agreements are standard practice at the early stages of large-scale projects, enabling information exchange and preliminary assessments. A collective of Korean energy and technology entities that have expressed interest in exploring the proposed investment.”
The municipality added that no final decisions have been made regarding the electricity requirements of the proposed facility or how electricity may be supplied.
Also, that any figures currently circulating publicly, including specific megawatt estimates, should not be regarded as confirmed project specifications.
“Water demand, sourcing, and associated infrastructure needs have not been determined. These matters fall within the scope of technical, environmental, and feasibility assessments that would take place should the engagement progress,” the municipality added.
Should the engagement progress beyond the exploratory phase, the municipality explained that all proposed development activities would be subject to the full suite of legislative and regulatory requirements, including environmental authorisations and water use approvals where applicable.
According to the municipality, the MOA is for exploratory and feasibility purposes and this approval does not constitute:
- Approval of the project itself.
- Approval of infrastructure commitments.
- Approval of financial contributions.
- Confirmation of technical specifications.
- Approval of regulatory or statutory authorisations.
zainul.dawood@inl.co.za
