Government unveils new sustainability standards for data centres and AI infrastructure

The Albanese Government has announced a new framework setting out expectations for data centre and artificial intelligence (AI) infrastructure proposals in Australia. These expectations prioritise projects that use clean energy, employ local workers, and have minimal impact on surrounding communities. Released by the Department of Industry, Science and Resources, the guidelines outline five key focus areas for developers: hiring Australians, contributing to local research and innovation, managing water efficiently, using energy sustainably, and reducing emissions through smart load management practices.

Although not legally binding, the framework will influence how the Commonwealth assesses major proposals for data centres and ‘AI factories’. Projects that fail to align with these standards will not receive priority consideration in the regulatory approval process. Existing operators seeking to expand their facilities will also be covered by the new rules, though small-scale or enterprise-specific data centres will be exempt.

Industry Minister Tim Ayres highlighted that the policy aims to ensure data centres uphold their social licence while supporting the national interest. Assistant Minister Andrew Charlton added that the approach will help ensure AI and data infrastructure deliver genuine benefits to Australians, reflecting the broader goals of the National AI Plan launched in December 2025. The new expectations form part of a coordinated effort to make technological growth in Australia sustainable, clean, and socially responsible.