Q1 business case·BCDF Stage 1 — Strategic Business Case·Gateway Gate 0·2026
Strategic Business Case: the service need for sovereign compute.
BCDF Stage 1 substantiates the need before any option is chosen. The need is concrete: Australia's regulated workloads run on foreign-owned compute, the legal exposure is widening, and Queensland Government AI-inference demand is scaling from ~A$15M/yr today toward ~A$1.17B/yr by 2033–35 with no sovereign supply to meet it. This SBC articulates the strategic case; the PBC analyses the options; the DBC proves the investment.
How to read this. Queensland Treasury's BCDF develops an investment proposal through three documents — Strategic Business Case → Preliminary Business Case → Detailed Business Case — each assured at a Gateway review gate. Q1's ~A$116M pilot sits above QT's $100M Gateway threshold, so we've written the business case in that structure. AloomU is private capital; presenting in the buyer's own framework means the proposal is already legible to QGOV's investment-assurance process and to any public-sector co-investment or procurement pathway.
The service need BCDF Stage 1 · the strategic case
The problem. Regulated Australian workloads (Commonwealth, state, Defence) increasingly cannot lawfully or prudently run on foreign-owned hyperscale compute — yet that is effectively all that exists at scale in-country. Sovereign demand has no sovereign supply.
Why now. Frontier labs ran out of their own capacity in June 2026 (Google → SpaceX ~US$920M/mo; Anthropic ~US$1.25B/mo; ~US$26B/yr of rented compute per SpaceX's SEC Form FWP). GPU contract pricing rose ~40% in six months. New firmed supply enters a structurally short market under a premium price umbrella.
The consequence of inaction. QGOV and other regulated buyers either defer AI adoption or accept offshore legal exposure (CLOUD Act, FISA 702, EO 12333) and data-egress risk. Neither is acceptable under the tightening regulatory floor.
Strategic alignment policy & regulatory drivers
Driver
What it requires
How Q1 responds
SOCI Act 2018
Critical-infrastructure data handled under Australian control
QGOV in production today on AloomU sovereign compute — QChat (the public-service generative-AI assistant) and QGCS (Queensland Government Consulting Service). QWork is the named compute-offtake channel, integration live.
Demand trajectory ~A$15M/yr today → ~A$1.17B/yr by 2033–35.
Beyond QGOV — Logan City Council runs workloads today; UQ and QUT conversations underway. Addressable: combined federal + state + Defence IT spend ~$30B/yr; a ~$500M ARR ceiling at 1–3% of the regulated-sovereignty segment over five years.
Investment logic & critical success factors
ProblemNo sovereign compute supply for regulated AU demand.
InterventionFirmed, in-region GPU substrate on energy-precinct ground.
OutputsBehind-the-meter sovereign capacity; signed provenance.
Critical success factors: firmed power + grid headroom + heat sink under one cooperative owner; AU ownership with no foreign legal nexus; contracted offtake; uptime; an auditable path to renewable provenance.
Gateway position
Gate
Gateway review
What it tests
Our product
Status
0
Strategic assessment
Service need substantiated — sovereign compute for QGOV & the regulated sector
Executed terms + tenancy; Stage-1 capital committed (FID)
DBC
Pending — CPs open
4
Readiness for service
Pilot energised; switch cut over to Swanbank silicon; dashboard → production
Wave 2
Future
5
Benefits realisation
Utilisation proven; Customer #2 live; QGOV value delivered
Wave 3–4
Future
Gate 0 — addressed. The service need is substantiated and strategically aligned. Recommendation: proceed to options analysis (the Preliminary Business Case).