Australia has unveiled a national AI framework aimed at attracting investment while tightening safeguards around energy, jobs and creative industries.
The Albanese government has unveiled what it describes as a world-leading artificial intelligence framework, introducing national standards for AI and large data centres as it seeks to attract investment while tightening oversight of the rapidly expanding sector.
Speaking in Sydney, Prime Minister Anthony Albanese said AI would reshape Australia’s economy on a scale comparable to the Industrial Revolution, arguing the country needed “AI models and data centres built on our red soil here in Australia” to ensure the benefits flowed domestically.
The framework includes a new set of Australian Standards for AI, which will build on the government’s existing Data Centre Expectations and establish nationally consistent rules governing large-scale AI infrastructure.
Under the proposed standards, large data centres would be legally required to underwrite their own new power supply, pay the full cost of connecting to the electricity network so household energy bills are not affected, reduce electricity use when required to support grid stability, and operate as efficiently as possible in their use of water.
The federal government will also work with state and territory governments to ensure new facilities are built in appropriate locations and with input from local communities.
Supporting the reforms, the Office of AI has been established within the Department of the Prime Minister and Cabinet, effective immediately, to accelerate implementation of the standards nationwide.
The government’s approach will be considered by the National Cabinet in August, with legislation expected to be introduced early next year.
According to the government, the framework would become the first legislative regime of its kind introduced by any government globally, creating a single regulatory framework for large data centres and AI training while providing greater certainty for investors through faster approvals and streamlined compliance processes.
Laina Chan, practising barrister and founder and chief executive of MiAI Law, said the announcement marked a significant step towards a more coordinated AI policy, particularly through the creation of a national Office of AI and a single regulatory framework.
“There is much to welcome in the Prime Minister’s announcement. A national Office of AI, coordinated standards and a whole-of-government approach should reduce regulatory fragmentation and provide greater certainty for investors and Australian businesses.
“The Prime Minister is also right to identify Australia’s stable democracy, legal system and financial institutions as important competitive advantages.”
However, Chan warned those measures would need to be matched by internationally competitive investment settings if Australia hoped to attract globally mobile AI capital.
“Australia cannot rely on legal stability to attract globally mobile AI investment while making the acquisition, ownership and disposal of Australian assets materially less attractive. National standards and streamlined approvals are positive measures, but they need to form part of a coherent investment policy that also recognises the importance of internationally competitive tax settings.”
Industry reaction
The government’s proposal also drew support from the Australian Council of Trade Unions, which said the creation of an Office of AI and mandatory standards for large AI data centres reflected a more active approach to managing the technology’s impact on workers and the broader economy.
ACTU secretary Sally McManus said Australians had yet to see clear benefits from AI in the workplace and stronger protections were needed.
“Australians don’t trust AI because of the lack of [a] clear benefit for working people. We have had big promises, but so far, no guarantee that any benefits will be shared with workers.
“Unions don’t want to veto technology use, only to veto the harm it could cause.”
McManus also welcomed the government’s proposal to make AI developers and data centre operators more accountable.
“It’s good the Government is taking a more active role in AI policy and is willing to take action to ensure that it benefits Australians.
“The proposed Australian Standards for AI is also an important first step in regulating AI use when it comes to data centres. Data centres should pay their own way, and building data centres should not result in higher power bills for working people.”
The package also includes measures aimed at protecting Australian creative industries, with the government stating that Australian writers, artists and journalists should retain ownership of their work and that companies should not be able to use Australian creative content to train AI without the creator’s control.
Albanese said “Australian music, art and writing are not up for grabs”, while McManus welcomed the government’s position.
“We welcome the PM’s strong stance against the theft of creative works and the Government’s consistent refusal to give big tech an exemption from having to pay for the copyrighted content they use.”
The Climate Council also backed the announcement but said the success of the framework would ultimately depend on how the new standards were implemented.
CEO Amanda McKenzie said rapid growth in AI data centres could place significant pressure on Australia’s electricity system unless new renewable generation was developed alongside them.
“The AI-driven surge in data centres will have a profound effect on our energy system, and unchecked, this growth could mean soaring prices and rampant climate pollution. The Government must adequately regulate data centre growth to ensure it occurs in the best interests of Australians.
“This means upholding Prime Minister Albanese’s pledge today that data centres match their energy demand with new renewables and storage to shield households and other businesses from increased costs.”
Further details on the government’s AI consumer safety priorities are expected in the coming weeks, building on the recent establishment of the AI Safety Institute.
Albanese said the framework was intended to ensure Australia shaped the development of artificial intelligence rather than responding to it.
“This world-leading framework is about Australia choosing to shape the future rather than letting the future of AI shape us. This framework is about protecting our national interests and ensuring certainty for growth, jobs and investment.”
“If we set our national standards high, then we can make AI stand for Australia’s interests.”
