Prime Minister Anthony Albanese has unveiled new legal standards for artificial intelligence and data centres, setting up a framework to manage the rollout of the emerging technology which will be introduced in early 2027.
The government plans to require AI data centre operators to cover the cost of new energy generation over concerns from communities about the environmental impacts.
Amid warnings the technology risked "draining" Australia's energy and water resources, Industry and Science Minister Tim Ayres said a moratorium on new data centres - for which the Greens and a range of experts are advocating - was not the answer.
"It's a pretty dopey position that just takes us backwards," he told the ABC's AM program on Thursday.
"We cannot afford to stand still as a country. The data centre expectations are being worked through with the states ... it's very clear to see the direction of travel here," Mr Ayres said.
But UNSW professor and AI researcher Toby Walsh said at a minimum there should be a halt on new approvals for data centres until the guardrails were in place.
"We need to make sure these centres aren't a drain on us and insist at a minimum on additional renewables," he told AAP.
"The devil is often in the detail and it's good there will be a whole-of-government approach to AI's whole-of-economy transformation.
"But there wasn't any additional spending in the announcement, particularly when research and development is at a record low in Australia."
Mr Albanese, who will set up an office for AI within his own department, said companies were welcome to invest in Australia, if they met conditions.
"So you want to build a big data centre, you have to provide the energy so that's additional to the grid," he told ABC's 7.30 on Wednesday evening.
"You have to pay for transmission. If there are any additional water usage, you have to fund that as well, and it needs to be located in an appropriate location as well."
But the plan was nothing more than motherhood statements with little detail, Opposition Leader Angus Taylor said on Thursday.
"All he's done is create an office in an office, more bureaucracy," Mr Taylor told Nine's Today Show.
The opposition leader said more information was needed on whether unions would have vetoes over AI use, how Australia would get access to leading AI models from the United States, and how writers, musicians and other creatives would have their intellectual property protected.
Business groups warn too much regulation will stifle investment, with one of Australia's biggest banks estimating the data centre pipeline will exceed $155 billion.
Business Council chief executive Bran Black acknowledged community concerns about data centres needed to be respected.
OpenAI, which opened its Australian office in December, has signed an agreement to become the initial offtake investor for a proposed data centre in Western Sydney.
A company spokesperson said the organisation wanted to work with Australia to help the nation reach its ambitions.
"This is truly a once-in-a-generation opportunity for Australia's economy and it's crucial the country gets this right," OpenAI's spokesperson said.
"We are committed to engaging constructively throughout this process with the government, creators and industry on an approach that is practical, sustainable and right for Australia."
Greens environment spokeswoman Sarah Hanson-Young, also chair of the inquiry into AI data centres, said a pause was needed on the approval and construction of new mega data centres while policy work was underway.
"Just because big tech companies want to move at hyperspeed, doesn't mean that we need to fast track and roll out the red carpet for them," she said.
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