Short answer is: use en_AU.UTF-8 for your locale. If it doesn't exist
you can create it using /etc/locale.gen (assuming you're running some
kind of linux)
I've just installed that locale on my system (Debian Sarge). However I'm
still getting the error. I only set the locale for that user, could it
be that the locale needs to be set to UTF8 system wide? Here's the output:
postgres@mrnaz:~$ locale
LANG=en_AU.UTF8
LANGUAGE=en_AU.UTF8:en_US.UTF8:en_GB.UTF8:en.UTF8
LC_CTYPE=en_AU.UTF8
LC_NUMERIC=en_AU.UTF8
LC_TIME=en_AU.UTF8
LC_COLLATE=en_AU.UTF8
LC_MONETARY=en_AU.UTF8
LC_MESSAGES=en_AU.UTF8
LC_PAPER=en_AU.UTF8
LC_NAME=en_AU.UTF8
LC_ADDRESS=en_AU.UTF8
LC_TELEPHONE=en_AU.UTF8
LC_MEASUREMENT=en_AU.UTF8
LC_IDENTIFICATION=en_AU.UTF8
LC_ALL=
postgres@mrnaz:~$ createdb twerl -E utf8
createdb: database creation failed: ERROR: encoding UTF8 does not match
server's locale en_AU
DETAIL: The server's LC_CTYPE setting requires encoding LATIN1.
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