The tussle over Australian datacentres is just beginning – and it’s been far from easy so far | Tom McIlroy
News Source
•Fri, 28 Aug 2026 15:00:06 GMT
📰 What Happened
The Australian Energy Market Operator released a snapshot showing datacentre electricity use is growing fast. It forecasts consumption rising from about 3 per cent of grid power today to 13 per cent by 2035. That is a tenfold jump to 52 terawatt hours.
There are already 165 datacentres in Australia, with 225 more in development. The Albanese government plans major AI laws after summer, including planning rules and new copyright protections. A national cabinet meeting this week discussed the plan.
Albanese said datacentres must run on renewables, not push up power prices, and help the shift away from fossil fuels. But Queensland and the Northern Territory pushed for coal and gas carve-outs. Energy minister Chris Bowen insists no state will get special treatment.
🔍 The Backstory
The AI boom runs on giant warehouses of computer servers, and those need huge amounts of electricity. Until recently, datacentres were a quiet part of the grid. Now they are at the centre of a national fight over energy and planning.
Conservative-led states want to use their own gas and coal reserves. Queensland's David Crisafulli pushed for access to coal. The NT's Lia Finocchiaro wants the Beetaloo gas basin included. Both claimed wins after this week's meeting.
Renewable energy groups say allowing fossil fuels would drive up power bills and lock in pollution. The Grattan Institute doubts gas will be cheaper than wind or solar. More negotiations are coming as the big bill moves through parliament.
🎯 Why It Matters
Every time you stream a show or use an AI app, a datacentre somewhere burns power. These decisions shape your electricity bill and Australia's climate future. How we power the AI boom will affect every household.
The Australian Energy Market Operator released a snapshot showing datacentre electricity use is growing fast. It forecasts consumption rising from about 3 per cent of grid power today to 13 per cent by 2035. That is a tenfold jump to 52 terawatt hours.
There are already 165 datacentres in Australia, with 225 more in development. The Albanese government plans major AI laws after summer, including planning rules and new copyright protections. A national cabinet meeting this week discussed the plan.
Albanese said datacentres must run on renewables, not push up power prices, and help the shift away from fossil fuels. But Queensland and the Northern Territory pushed for coal and gas carve-outs. Energy minister Chris Bowen insists no state will get special treatment.
The AI boom runs on giant warehouses of computer servers, and those need huge amounts of electricity. Until recently, datacentres were a quiet part of the grid. Now they are at the centre of a national fight over energy and planning.
Conservative-led states want to use their own gas and coal reserves. Queensland's David Crisafulli pushed for access to coal. The NT's Lia Finocchiaro wants the Beetaloo gas basin included. Both claimed wins after this week's meeting.
Renewable energy groups say allowing fossil fuels would drive up power bills and lock in pollution. The Grattan Institute doubts gas will be cheaper than wind or solar. More negotiations are coming as the big bill moves through parliament.
Every time you stream a show or use an AI app, a datacentre somewhere burns power. These decisions shape your electricity bill and Australia's climate future. How we power the AI boom will affect every household.