Amazon Australia has announced a 10-year partnership with the Australian River Restoration Centre to revive parts of the Coxs River in NSW and boost Sydney's water supply by almost 400 million litres.
The announcement follows increased scrutiny of data centres' water and power use in Australia, and comes after all but two states and territories agreed to introduce requirements for their use of renewable energy.
The US tech company will fund restoration work along a 14.8 kilometre stretch of the Coxs River in Greater Western Sydney where land-clearing, cattle and invasive plants have impacted its water supply.
The Australian River Restoration Centre will consult with landowners along the river, centre chief executive Siwan Lovett said, to remove thirsty, introduced species and move livestock away from its banks.
"We're working in a catchment area that hasn't had a lot of investment in river restoration for quite some time," she said.
"We'll be doing things like removing dense willow infestations."
By planting native species and creating natural barriers for the river over the first two years of the project, Ms Lovett said the group would restore water flow gradually.
"We are a really dry continent so being able to get water replenishment projects underway does take time," she said.
"You've got to be prepared to put the work in early to get the benefits later on, when (vegetation) grows, when willows are removed, when banks stabilise."
The project will be the second local river restoration project for Amazon Australia, infrastructure policy head Matt O'Rourke said, and was designed to return water to areas where it used it to cool data centres.
"The attractiveness of this project is that it's supporting the Sydney catchment area, which is the same catchment area where our Sydney regional data centre construction is," he told AAP.
The company, which announced plans to spend $20 billion on Australian data centres by 2029, has a global goal to return more water than it uses by 2030.
The restoration project will come in addition to efforts to reduce water use, Mr O'Rourke said, and invest in renewable energy projects.
"We can completely understand the concerns that are being expressed within the community — they're seeing a lot of exponential growth in the expansion of data centre capacity and wondering if that's sustainable," he said.
"That's the right question to ask."
Amazon's announcement comes less than a week after most federal, state and territory energy ministers agreed to introduce national renewable energy requirements for data centre developments.
Ministers from Queensland and Northern Territory governments voted against the changes.
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