Key facts
- Federal legislation will mandate renewable energy for new AI datacentres.
- Gas-powered datacentres will be banned from meeting national standards.
- The federal government will override state objections from Queensland and the Northern Territory.
- New datacentres must demonstrate renewable energy sourcing and grid flexibility.
- The Australian Energy Market Commission recommended renewables certificates for datacentres.
Australia's Energy Minister Chris Bowen announced that federal legislation will mandate that new AI datacentres be powered by renewable energy, overriding objections from Queensland and the Northern Territory, which had favored gas-fired power. Bowen stated that datacentres relying solely on gas would not meet the proposed national standards and would not be permitted to register.
The Australian Energy Market Commission (AEMC) has recommended that datacentres be required to provide renewable energy certificates to ensure their significant energy demands do not negatively impact consumers or the grid. The AEMC noted an "unprecedented increase" in connection requests in Western Sydney, totaling approximately 8 gigawatts.
The Northern Territory has awarded land to Beetaloo Digital to develop a 2-gigawatt data centre, with plans to power it using shale gas resources from the Beetaloo sub-Basin. A spokesperson for Beetaloo indicated the project could complement planned solar generation and battery storage by providing firm capacity, and estimated it could attract up to A$40 billion in private investment. Bowen clarified that while gas could serve as backup power, it could not be the sole energy source for new datacentres.