Australia commits to shared data centre standards in national and state governments

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Australia’s national cabinet of national and state premiers has set out plans for coordinated policy on the development of data centres for artificial intelligence.

The country’s national cabinet met on 26 August to discuss the legislation planned by prime minister Anthony Albanese to regulate the development of data centres. Australia is one of many countries considering how to respond to the need for new data centres and concerns about their development and operation.

A communique on the meeting said that artificial intelligence “represents a generational opportunity for Australia if properly harnessed”. However, the leaders also highlighted that large data centres bring material, energy, water and land-use impacts that need to be managed.

The meeting – which was attended by the premiers of New South Wales, Victoria, Queensland, Western Australia, South Australia, Tasmania, the Australian Capital Territory, and the Northern Territory – confirmed that the central government will introduce a nationally consistent regulatory framework that will set minimum requirements for large data centres that will apply across the country.

The statement said that the framework “will ensure Australia can capture the opportunity, share the benefits and keep Australians safe”, and commits the government to develop consistent mandatory standards for data centre energy, water and land-use, and support skills and training opportunities.

These standards will ensure consistency and clarity for investors, while also focusing on strengthening Australia’s economy and sovereignty, according to the statement.

Overall, the central government legislation will be designed to complement, not duplicate, state and territory planning and approval processes, with the detailed legislation to be published in early 2027.

Read more: Australian government report warns women and graduates most at risk of losing jobs to AI

Data centres increasingly the centre of political debate

Australia is the latest country to take action in response to concerns around the environmental impacts of data centres. In many countries there has been increasing opposition to data centres, driven by concerns over their energy and water use.

In the UK, the  Environmental Audit Committee has raised concerns that the government has not factored the energy consumption of data centres into its net zero plans, while energy regulator Ofgem has disclosed that new data centres whose developers have enquired about a connection to the grid would require more energy at peak times than the whole of Britain consumes on some days.

In the United States, opponents of data centre developments held ​142 coordinated protests across 42 states in July to highlight opposition, while in Canada, some local communities have voted for moratoriums on data centre construction.

Read more: Data centres threaten UK’s ability to meet climate targets, fear MPs

In Australia, Albanese said that “maintaining social license will be essential” for data centre construction. “That means ensuring energy bills do not rise, water security is maintained and locations are appropriate,” he said.

“Getting this right can ensure Australia is the infrastructure partner for our region, aided by our status as a Five Eyes partner.

“It will advance our national sovereignty. And it is essential for our national security, business productivity, science, innovation and resilience.”

Michelle Grattan, a professorial fellow at the University of Canberra, said that she expected Australia’s legislation to build on data centre “expectations” the federal government had previously outlined.

In an article for The Conversation, Grattan said legislation would impose obligations that data centres:

• Must not place upwards pressure on energy prices and must make a positive contribution to Australia’s energy transition.
• Use innovative, efficient and sustainable solutions to minimise water use, meet infrastructure costs and support transparent reporting on consumption and performance.
• Minimise community impacts and be appropriate for their size, function and infrastructure requirements, avoiding inappropriate locations near homes, schools and prime agricultural land for potential housing sites.

Public Service Data.AI
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