Data centre deal — Cape Town forced back to the drawing board

The Municipal Planning Tribunal’s (MPT’s) 14 July approval for the Equinix data centres has been legally suspended and cannot be acted upon after a formal internal appeal was lodged on 6 August by the Housing Assembly social movement and the UK non-profit Foxglove (represented by the Legal Resources Centre).

The City of Cape Town has publicly acknowledged that its data centre approval process requires reform, with Deputy Mayor Eddie Andrews confirming that the City “is in the process of formulating refined development guidelines for large data centre applications”.

Equinix issued a statement that the 327,000m² site it purchased in Cape Town represents a “long-term land bank” and that it “has no immediate plans to develop the site and has not submitted any planning or development applications”. The data centre builder pledged that any future development will be guided by feedback through transparent dialogue with local authorities and communities.

There’s just one issue: while Equinix frames its commitment to consult as forward-looking, the land-use rezoning and bulk reallocation granted by the MPT attach permanently to the land regardless of whether Equinix ever builds.

Into the foxhole

Asked about its endgame if all the wheeling and dealing turns out to be above board, Foxglove’s communications head Tom Hegarty responded:

“At the moment, we don’t even know if an Environmental Impact Assessment has been done at all, let alone whether it would be above board or not, which rather sums up the case. Our objection, with Housing Assembly, is about the huge gaps in the evidence provided by Equinix to the City of Cape Town, which we argue make it unlawful for the City to make a decision on approving the data centre or not unless and until that evidence is provided. Until it is, it’s impossible for Foxglove to make a judgment on the merits of the application or not.”

He explained that the legal challenge is appealing against the MPT’s decision to approve Equinix’s application to construct the data centre because the MPT lacked “fundamental basic information required for it to do so lawfully”.

He stressed that the “most important thing everyone needs to make an informed decision about this data centre is the critical information that its developers, Equinix, have so far withheld”.

Echoing this concern, dissenting MPT member Wally Johnstone (lead urban planner) explicitly stated during the hearing that the MPT had been asked to grant land-use rights for a 160MVA single-node facility without receiving basic electrical engineering profiling or line-flow assessments.

The MPT relied entirely on a high-level confirmation that Cape Town Electricity had issued a budget quotation and that the developer paid approximately R33-million in shared network charges. This ignores a key electrical engineering reality: high-density server power supplies, uninterruptible power supply rectifiers and variable-frequency drives for chillers generate non-linear loads.

Without static VAR compensators or active harmonic filter banks (highly specialised equipment costing tens of millions of rands), a 160MVA load will inject severe reactive currents back into the local 132kV primary network, causing voltage instability for neighbouring industrial and residential feeds in Airport Industria and Guguletu. That’s also a point Foxglove has raised in its appeal.

The classification game

Here’s where it gets really nerdy. The applicant (Equinix, which now says that it is just a land bank) confirmed at the MPT  approval hearing that the facility is designed for multinational digital infrastructure and “large data handling capabilities”.

It’s just that, in AI compute clusters, GPU utilisation can jump from near-idle (20%) to maximum thermal design power (100%) in milliseconds when a large language model (LLM) training job is initiated.

But the approval records contain no load-ramp agreements, step-load limitations, or spinning reserve requirements with Eskom’s system operator or regional control in Bellville.

Let’s put it this way: if a 50- to 100MW step-load occurs instantaneously on a 160MVA single node, it causes an immediate local frequency transient and voltage sag across the Philippi/Erica feeder corridor, directly affecting local production lines and vulnerable residential grids in nearby communities.

At least, that’s the way an anonymous former Eskom engineer explained it to Daily Maverick when we went hunting for answers to questions that the MPT never asked.

This brings us to the central concern. By classifying Equinix’s 122,545m² facility as a “warehouse that contains electronic equipment”, municipal planning authorities attempted to fit a high-voltage, continuous digital processing plant into a building code framework designed for low-intensity physical storage.

Wait, what do the National Building Regulations say about data centres?

That’s a great question. Under Sans 10400-A and Sans 10400-T, every building must be assigned an occupancy classification to determine its structural fire resistance, fire division size, emergency egress, and suppression systems:

• Standard warehouse classification (J2/J3): Standard warehousing is classified as Moderate Risk Storage (J2) or Low Risk Storage (J3). These categories assume inanimate, inactive goods stacked on racks, with low human occupancy, periodic vehicle movements, and predictable combustible fire loads (eg, cardboard, timber pallets and paper).

• The hyperscale data centre reality: A 160MVA hyperscale data centre houses tens of thousands of energised, high-density server racks operating 24 hours a day, seven days a week. Its primary hazards are electrical thermal runaways, high-voltage switching arc fires, lithium-ion UPS thermal events, and continuous heat generation from processors – none of which align with static J2 or J3 physical goods storage.

As dissenting urban planner Wally Johnstone pointed out to the MPT, defining a hyperscale data centre as a “warehouse that merely stores computers” is simplistic and wholly inadequate. Treating an ultra-high power density facility as a passive storage shed distorts statutory fire risk calculations from the outset.

Standard Part T compliance with National Building Regulations for large industrial warehouses relies on automatic water sprinkler systems. Discharging water onto energised 160MVA server racks and high-voltage busbars creates catastrophic electrical short-circuit hazards, toxic arc flashes, and total equipment destruction.

By approving the land use without architectural or fire-engineering plans, the MPT granted development rights without knowing whether the building envelope can structurally accommodate gas-pressure relief, high-voltage battery-room fire separation, or specialised fire divisions.

The developer’s application also provided zero information about diesel generator numbers, stack heights, fuel tank volumes, or major hazard installation (MHI) status. By deferring these details to the Site Development Plan (SDP) stage, the City approved land-use rights for a potentially high-risk industrial installation without evaluating its external fire and explosion hazards.

A view from inside the house

A formal written reply to parliamentary questions about the Department of Communications and Digital Technologies’ data centres position, authorised by Director-General Nonkqubela Jordan-Dyani and Deputy Minister Mondli Gungubele, outlined the national state framework:

“The Department of Communications and Digital Technologies (DCDT) developed the National Data and Cloud Policy to primarily create policy certainty required to assist multinational companies wishing to invest in data centres. This was co-developed with data centre industry players – hence the complete endorsement of the relevant stakeholders after the policy was approved by Cabinet in March 2024.”

The DCDT passed the investment incentives hot potato to Minister Parks Tau, because it falls under the Department of Trade, Industry and Competition, while the DCDT’s role is strictly limited to policy and regulatory frameworks.

“The department is of the view that when data centre investors present their infrastructure plans to municipalities, they must also outline short-, medium- and long-term water and electricity requirement forecasts that include their expectations from government, as well as their own plans to offset water and electricity demands,” said the department.

Unfortunately, none of those criteria was met with this application, but we hope that the City of Cape Town has factored all this into its case and the new regulations that are being drafted. DM