- Published on
Queensland and NT reject Labor’s push to ensure that power-hungry AI datacentres use renewable energy
- Authors
- Name
- DeepHorus
Queensland and the Northern Territory have rejected the federal government’s push to mandate that AI datacentres use renewable energy, opposing Prime Minister Anthony Albanese’s proposed regulations as "underdeveloped ideas that hand increased power to Canberra." The rift emerged during a meeting of state and federal energy ministers on Tuesday, where the Commonwealth sought binding standards for energy and water usage by datacentres. The federal Labor government insists it will proceed with its plans even without unanimous state support, aiming to introduce nationally consistent rules for the rapidly expanding industry.
The dispute comes as S&P Global warns that power consumption from datacentres could surge five-fold by 2035, reaching about 10% of Australia’s total energy use. The ratings agency cautioned that a mismatch between datacentre construction timelines and renewable energy project delivery could drive up electricity bills. The federal government is exploring price protections to shield consumers from potential spikes linked to the datacentre boom.
Under Albanese’s proposal, new datacentres would face a "legal obligation" to underwrite new power supply, pay grid connection costs, and "put at least as much energy into our grid as they take out of it." The rules would also require datacentres to generate renewable energy, minimise water use, and maximise efficiency. All states except Queensland and the NT backed the plan during the May energy ministers’ meeting, but the NT joined Queensland in opposition this week.
Queensland Treasurer and Energy Minister David Janetzki stated, "Queensland will always support proposals that deliver affordable, reliable and sustainable power, however, we will not support underdeveloped ideas that hand increased power to Canberra at the expense of Queenslanders." He emphasised the state’s focus on cost-of-living relief and economic growth. The NT Energy Minister Gerard Maley did not comment when contacted.
Federal government sources indicated that Queensland and the NT’s opposition would not derail the roadmap, with work on nationally consistent rules continuing. Federal Energy Minister Chris Bowen is scheduled to address the National Press Club next week, expected to reveal more details before a national cabinet meeting in August and another energy ministers’ summit in September. Federal powers over the Australian Energy Market Operator and grid connections could be invoked to enforce renewable requirements.
Public sentiment appears cautious: a Guardian Essential poll found less than a third of Australians would welcome a datacentre in their area, with 61% concerned about energy demand and prices, 44% about water supply, and 41% about environmental impacts. S&P noted that the Australian Energy Market Operator estimates datacentre energy use could rise to 20 terawatt hours, roughly 10% of national consumption by 2035.
