Essay by Eric Worrall
What could possibly go wrong with this plan?
AI in Australia’s interests
Speech
Wednesday 15 July 2026
The University of Sydney, SydneyThe Hon Anthony Albanese MP
Prime Minister of Australia…
Consider what international investors look for – and then think about what we have:
World class universities, producing skilled graduates and high-quality research.
The traditional resources, critical minerals and rare earths that are essential.
The space to build.
The sunlight to power affordable, renewable, reliable energy.
…
We know that companies will need to invest in skills and training to be successful.
And we know they will need energy too.
We will create a legal obligation for the next generation of large-scale data centres to underwrite new power supply.
To pay their full share of grid connection, so no costs are passed on to homes or businesses.
And to put at least as much energy into our grid as they take out of it.
To be net-generators, not net-users.
To build new renewable generation – and firming – to strengthen our national energy resilience.
And ensure data centres do not increase power prices for Australians.
Australia is the sunniest continent on earth but we’re also the driest.
Which is why our rules will require data centres to minimise their water use, maximise their energy efficiency, and pay for any additional water infrastructure required.
These location, energy and water obligations take in every level of government and their overlapping powers.
…
Read more: https://www.pm.gov.au/media/ai-australias-interests-0
It’s difficult to describe to people outside of Australia just how unfathomably incompetent Australia’s current federal administration is.
This latest brainstorm, to force US AI companies to pay for Australia’s renewable transition, is hot off the back of their other big idea, cancelling tax write-offs on most forms of private real estate and business investment to encourage the construction of new houses.
There’s also a bunch of stuff in the Prime Minister’s speech about trying to make US AI companies pay a fat fee to Aussie copyright owners.
What the Albanese government fails to grasp is AI companies don’t have to be located in Australia to provide services to and make money from Australians. I mean there are significant advantages for Australia if the data centers Aussies use are located in Australia, and fewer issues with Australia’s increasingly strict data privacy laws, but data center operators can make plenty of money from Australia without locating their infrastructure in Australia.
I have no problem with forcing data centers to provide their own power needs. But you have to be reasonable about it, like provide a fast track approval process for installing co-located modular nuclear reactors, or facilitate them building new coal or gas plants.
If powering AI data centers with renewables made economic sense, renewables would already be the preferred means of powering AI data centers. But given all the nuclear reactors, gas plants and other conventional energy facilities AI companies have been purchasing recently, or how the wait time for new high efficiency gas turbines has blown out to 5-7 years thanks to demand from AI companies, renewables are clearly not the preferred option.
