IREN will set up the massive data centre in Bundey, South Australia, a place with no residents that's 125km northeast of Adelaide and is home to the state's biggest electricity transformers.
The facility will be connected directly to that substation and is expected to draw up to 800 megawatts - enough to power 400,000 to 800,000 homes.
It's due to open in stages, beginning in 2028, and will support 200 ongoing jobs plus another 500 during construction.
By the time it opens, IREN says, SA's grid will be completely powered by net renewable energy.
"South Australia offers what AI infrastructure at scale requires: abundant clean energy, the connectivity to serve the APAC (Asia Pacific) region, and a state government that understands the opportunity and is acting on it," Daniel Roberts, IREN's co-founder and co-chief executive, said on Thursday.
Sydney-headquartered IREN was founded in 2018 by Mr Roberts and his brother, Will, as a Bitcoin mining operation.
They listed the company on the US tech-heavy Nasdaq exchange in 2021, under the name Iris Energy, before rebranding in 2024 as part of a pivot to AI and high-performance computing cloud data centres.
IREN has a market capitalisation of $US23 billion ($32 billion), supported by a multibillion-dollar AI cloud agreement with Microsoft and a partnership with NVIDIA, the AI chip maker that has surpassed Apple as the world's most valuable company.
IREN has existing data centres in the US and Europe, with a flagship facility in West Texas that's about the land area of Sydney's CBD, Barangaroo, and The Rocks combined.
When complete, the Sweetwater Hub will consume about two gigawatts - enough to power a mid-sized American city.
SA Premier Peter Malinauskas said the data centre was a significant opportunity for the state.
"South Australia's leadership in renewable energy, our record investment in higher education, our unashamed pro-jobs and pro-business outlook and appointing the nation's first dedicated minister for artificial intelligence means we are uniquely placed," he said in a statement.
IREN said the site featured submarine fibre connectivity into major regional demand centres, including Singapore, Indonesia, South Korea and Japan.
The project reinforced IREN's ability to secure large-scale, power-dense sites with favourable transmission characteristics and long duration, investment bank Macquarie said in a research note.
"Overall, Bundey expands IREN's global development footprint into APAC (the Asia Pacific) and positions the company to capture incremental hyperscale demand in a high-growth, undersupplied market."
