Essay by Eric Worrall
h/t JoNova / David – “… we must seize the opportunity …”
Australia has what it takes to lead in AI
05 June 2025
This opinion article by Business Council of Australia Chief Executive Bran Black was published on Capital Brief on 3 June 2025.
…
One narrative that dominates many conversations around AI in Australia is that we are most likely to be a passive recipient of global technology. An “AI taker” rather than “maker”, as UK policymakers have termed the distinction.
But this pessimistic assumption fundamentally discounts some of our greatest national advantages when it comes to the application of new technology.
…
We are also ideally placed to become a regional hub for AI infrastructure. Australia can host world-class data centres powered by renewable energy, helping global and local organisations train models securely and sustainably.
With investment, these facilities can also serve as the backbone for sovereign AI capabilities, supporting industries from mining and agriculture to healthcare and advanced manufacturing.
…
Read more: https://www.bca.com.au/australia_has_what_it_takes_to_lead_in_ai
This claim AI can be powered by renewables flies in the face of evidence that green tech giants are rushing to dump green energy commitments, in their desperation to stay relevant and competitive in the AI gold rush.
Microsoft went straight for nuclear power for their AI
Facebook is building a gas powered generator;
Google was recently accused of greenwashing, they appear to be quietly purchasing fossil fuel capacity to power their AIs;
Why did these former big tech green champions ditch renewables and go straight for serious energy solutions? The reason is AI is a cloud based service, where operational costs are dominated by the cost of energy. Anyone selling AI capacity has to at least match the price of comparable AI services offered by China and Asia. Energy prices in China and Asia are really low – especially I suspect for businesses which are considered by China to be a strategic national priority.
No serious player believes AI can be powered by anything other than the most concentrated, reliable energy sources available. A few of them are making noises about exploring the options, but actions speak louder than words.
There will be some Aussie based AI, in sensitive applications such as the Australian military, where security matters more than cost. But so long as Australia embraces green delusions over reality, we Aussies will be stuck in the slow lane. There will be Aussie breakthroughs, we Aussies are pretty good at high tech. But the bulk of those Aussie AI innovations will end up running on other people’s computers, for lack of the affordable energy required to create a genuine Aussie AI presence.
On our current delusional green trajectory, Australia, for all our world class energy and mineral resource abundance, seems doomed to miss the AI boat. Australia’s irrational green energy policies more than justify that boardroom pessimism the BCA acknowledged in their article.
Discover more from Watts Up With That?
Subscribe to get the latest posts sent to your email.
Watching someone’s delusional behavior is sad.
This is how the masses get indoctrinated that renewables provide the same reliable energy as tried and proven fossil fuel, hydro, or nuclear. Someone with no concept of requirements claims it can be done and the media runs with it. Just the time it takes to reboot and recover from a surprise power interruption is hours. A battery big enough to save a data center would cost big $$, and more than a bank of generators powered by fossil fuels.
The data centres I’ve been involved with had enough battery backup for about an hour, and enough diesel for the generators to keep them going for between a day and a week.
The battery backup is mostly there in case the generators don’t auto-start within the first few minutes.
It must be nice to believe in magic.
I’m going to be naive and keep believing the magicians won their election.
I can’t wait for the collision with reality! Popcorn please!
“I’m sorry, Dave. I can’t do that.”
One real-world illustration of the stark reminder of how many more $billions would have to spent on wind turbines & solar panels for them to supply the additional needs of AI any time soon –
there’s such a long way to go –
(I sincerely hope Willis doesn’t mind me using his honest work to illustrate my point)
This chart shows batteries as a source of electric power. They are not sources, they are consumers
They are like banks, accepting money (energy) from others and storing it but taking a little bit for themselves and adding nothing to the account. After a while, if you don’t draw on the account, you find that that little bit consumed the entire account.
Banks, despite all valid complaints, do usually pay interest and are in USA cases FDIC insured vs financial disaster. Batteries slowly lose energy. However small the energy loss gets battery loss is inevitable. The equivalent bank would be paying negative interest. Thus I side with Denis – they are consumers.
And, over time, the capacity to store is diminished until they need to be reppaced.from an inability to be recharged
It’s interesting to read this in light of what has happened since the turn of the century. At that time I recall speaking to an Aussie businessman who wanted to be more than a source of raw materials to other nations and start manufacturing higher value added products domestically. Since that time the amount of raw ore, coal and natural gas being exported has exploded and the Australian automotive industry has collapsed. Why does a country rich in coal and iron ore not produce much steel? It’s a bigger reach to think that just because a country can make lots of (expensive) renewable energy that they can become an AI powerhouse.
Back in the 1950s Australia had a substantial manufacturing industry for precisely this reason.
Then the government got greedy, and over the decades ratcheted up taxes and regulations, until it became easier to ship ore to Asia and purchase finished products than to manufacture in Australia.
The latest brainstorm from our federal government, taxing unrealised capital gains based on government estimates of how much assets would be worth if sold, might even finish off our mining industry.
Yes, the final straw for Toyota assembling vehicles in Oz was an activist leftist judge’s ruling in favor of the auto workers union that Toyota’s executives could not directly engage for pay & conditions discussions with their employees.
So all those people who could have been employed by Toyota.. were suddenly unemployed..
Always the way with leftists..
Same story in Europe, then USA and Aus. Chinese people are just people who live in China so might I expect that their politicians will eff it up too? The government format and social assumptions are a little different, but here I have to assume people are people and their government will also succumb to short term thinking if standard of living catches up.
A far left candidate for some state office recently asked why it is controversial for illegal immigrants to be getting free healthcare.
After all, according to her, health care is a human right and should be free for everyone.
The question is, how can something that has to be provided by someone else, be not only a right, but provided for free? Either the doctors and the health care system work free of charge and become essentially slaves of the state, or the taxpayers are forced to pay, and they become essentially slaves of the state.
Beyond that, what is the logic of declaring that health care is a human right, but not food, housing, clothing, the job of your choice, etc?
MarkW:
Agree.
Re: your last sentence – Yikes! Don’t give them more ideas!
They have enough bad ones already. lol
My question is, who bestowed these rights? Not Man. They are not in the laws we have written. No religion I am aware says they are God given rights. The only ‘rights’ nature gives is the right to eat what doesn’t eat you. So who or what created these rights?
The question I go to is:
If you have a pill that will extend healthy life for a year and it costs $1,000,000 per pill, who gets them and how many do they get? If healthcare is truly a right, then everyone has to get one every year – forever.
AI appears to be a tech race for all the countries mad that USA invented and owns the Internet. I don’t think AUS has enough computer programmers, even if AUS had infinite electrical energy. For now it looks like a three-way race between Californian tech wealth, Chinese copycats and underpaid/overeducated Indian programmers. The chinese might be winning but I don’t know enough to judge.
Am I right in guessing all the 20th century Eastern block nations are out? (or just wrong about everything)
2GW is basically the entire output of Diablo Canyon NPP which currently provides 5% of California’s electricity demands. If Farcebook’s datacenter needs 2GW to function then 20 datacenters would demand as much energy as the entire state of California…every day.
Yep, it’s about to get real.
Buy stock in natural gas companies, now. NG and coal power plants are the only type that can be built in time to meet forecasted demand, and coal has a worse public acceptance. NG production can likely meet demand and prices may not go up much, but the sales volumes will send profits soaring.
Eric
“Energy prices in China and Asia are really low “
From your link:
“In 2025, China continued refining its power pricing mechanisms to improve cost transparency, promote efficient usage, and accelerate the integration of renewable energy. Notably, in the first quarter of 2025, China added 74.33 GW of new wind and solar capacity, bringing the total installed capacity of wind and solar to 1.482 billion kW, surpassing coal-fired power capacity (1.451 billion kW) for the first time. Beginning June 2025, all newly commissioned wind and solar projects are required to sell electricity through regional power markets rather than receive fixed feed-in tariffs. While this introduces pricing variability, it also enables qualified enterprises to pursue cost-saving opportunities via direct power purchase agreements (PPAs) and participation in the green electricity certificate (绿证) market.”
capacity. capacity. capacity.
I’ve got capacity for 50 hours of work a week, but like wind & solar, I’m struggling to bill 15 hours.
Nah you have capacity is 7×24 = 168 hours per week
So you are running at a work factor of 15/168 = 0.89%
But yes Nick is doing his classic willful misinformation in 2024 renewables were 35% of the total electricity generated in China. Based on those numbers renewable capacity needs to get to 2.11 billion kW to even break at 50% with actual generation.
Note I used the official china figure of 35% renewable generation, that number is disputed the real number may be as low as 13% lets just say it’s not a country you can rely on “official figures”.
“classic willful misinformation”
I simply quoted Eric’s source.
The solar is being “firmed” by coal – it’s just to impress Xi.
https://wattsupwiththat.com/2023/06/30/bbc-china-is-firming-wind-and-solar-power-with-coal-plants/
Solar is a drag on energy efficiency, not a benefit. All those fossil fuel plants have to be kept on hot standby, in case a cloud covers the sun.
A recent comment stated that in China, solar and wind nameplate was 52% of the power sources, but in reality only contributed 12% of their total power. Coal was 42% of nameplate, but contributed 70% of their total power total.
For 2023, fossil fuels delivered 65% of China’s electricity, solar and wind 16%, hydro 13%, nuclear around 4.7%.
So? “China’s construction of new coal-power plants ‘reached 10-year high’ in 2024”.
And this year? “China’s Coal Power Plant Approvals ReboundBy Tsvetana Paraskova – Jun 05, 2025, 7:20 AM CDT”
You’re beginning to look as though you are deliberately setting yourself up for ridicule, Nick.
You keep bringing this up. Wind and solar capacity is meaningless since it is not a source of useful energy at all. It can’t be relied upon at any time, even in summer.
“ green electricity certificate (绿证) market” – What is this? Just another form of subsidy and distortion of the market. Imaginary magical value?
Australia running its AI on renewables is the equivalent of an F1 team running their race car with a Model A Ford engine. Australia’s leaders are pathetic.
Or racing in Le Mans with an EV.
The IEA say the largest AI data centres currently under construction consume as much electricity as 2 million households. Build 10 of them and it is equivalent to growing your population by over 20m people.
IEA ‘Energy and AI’ (April 2025)
They also note that investment in grids is struggling to keep pace with the rise in power demands and renewable deployments. Grid development is being held back by lengthy permitting procedures and supply chain “tightness” for transformers and cables.
IEA ‘World Energy Investment 2025’ (June 2025)