State and federal energy ministers have agreed that data centres should be required to invest in new renewable energy and storage to fully offset their electricity consumption, with Queensland the only state dissenting. The decision was made at a meeting of the Energy and Climate Change Ministerial Council last week.
The ministers also called for data centres to provide 'demand flexibility services' to manage their electricity draw from the grid. The Australian Energy Market Commission has been asked to advise on implementation by July. Federal Energy Minister Chris Bowen stated that data centres are a major driver of new energy demand and should strengthen the grid rather than strain it.
Queensland Energy Minister David Janetzki opposed the move, citing concerns over costs and reliability. He said Queensland needs to see details on costs, benefits, and risks before agreeing to any national proposal that could affect electricity bills.
Data Centres Australia, the peak industry body, noted that operators already offset 70% of their energy use through renewable energy agreements and expressed ambition to reach 100% offsetting, but stressed the need for viable renewable projects. The industry has invested $3.1 billion in energy infrastructure from 2020 to 2025, with a further $7.2 billion expected by 2030.
Australia currently has 162 data centres with an operational capacity of 1.4 gigawatts, expected to more than double to 3.2GW by 2030. The Australian Energy Market Operator forecasts a tripling in electricity use by data centres by 2030, from the current 2% of the main east coast market's electricity.
