Six weeks after declaring that future large-scale data centres would need to be tied to new renewable energy projects, Prime Minister Anthony Albanese has already carved out an exception.
Fri 28 Aug 2026 01.00 AEST
Photo: AAP Image/Dan Himbrechts
On Monday, Australian Energy Producers (AEP) - the lobby group representing the foreign owned gas giants that export 80% of Australia’s gas - welcomed the Coalition’s announcement to help them export even more of Australia’s finite gas resources by cutting environmental protections and increasing subsidies.
Six weeks after declaring that future large-scale data centres would need to be tied to new renewable energy projects, Prime Minister Anthony Albanese has already carved out an exception.
Queensland and the Northern Territory have emerged from Wednesday’s national cabinet meeting victorious, securing the final say over how new data centres are powered, including tapping into coal and gas.
“I certainly understand that different states have different issues, but we know that the priority is keeping our energy costs low,” Mr Albanese said, according to The Australian.
Countries around the world are grappling with how to strike the right balance between power-hungry, water-guzzling data centres and keeping the lights on at an affordable price for households.
The Australian Energy Market Operator (AEMO) said there are 225 known data centres potentially in the pipeline, including a $31.9 billion project in Queensland’s Western Downs.
Northern Territory Chief Minister Lia Finocchiaro said the deal with Canberra allowed her government to push ahead with a proposed $40 billion gas-powered AI data centre, fuelled by Beetaloo Basin gas.
“Today’s deal recognises the Beetaloo Basin will be online within days, we are not part of the National Electricity Market, and we have a Territory-owned generation, transmission, and distribution system,” she said.
However, NT independent MP Justine Davis is calling for an immediate moratorium on the planning and development of local data centres “until Territorians know exactly what they are signing up for”.
The MP pointed to serious community concerns about proposals for up to 12 hyperscale data centres, but that “the Government has failed to listen or provide answers”.
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The NT Government has granted Beetaloo Digital exclusive rights to 185 hectares of land at Weddell, about 30km from Darwin, to investigate a possible hyperscale data centre powered by Beetaloo Basin gas.
The proposed centre would require up to two gigawatts of power – more than six times the peak electricity demand of Darwin and Katherine, according to the ABC.
Ms Davis argued the details of the deals shouldn’t be kept secret.
“When we’re talking about the use of billions of litres of water, and 6 times the entire NT’s power usage for one centre alone, refusing to be transparent about the deals is a fundamental breach of Territorians’ trust,” she said.
“Territorians deserve to know how much water the government has promised to give away to these companies, where this water will come from, and how the centres will be powered.
“We deserve to know what data centre development will mean for the NT’s already sky-high emissions, and what Territorians would get in return.”
She’s calling for a public inquiry to allow for “proper evidence-gathering” and community consultation.
“This isn’t just about Canberra telling the Territory what to do,” she said.
“This is about Territorians saying: we want to know what is going on in our backyard.”
