Chris Bowen rules out state carve-outs for federal datacentre energy laws

Chris Bowen insists federal Labor’s new national laws on datacentre power supply will not include carve-outs for Queensland and the Northern Territory, with states that are eager to use coal and gas required to make their case to the national regulator.

The energy minister told Guardian Australia on Friday the only concession agreed at Wednesday’s meeting of national cabinet was that existing coal and gas supply could be used on the condition it could be shown to be cheaper than renewables.

Anthony Albanese had gone into the meeting clear that new national rules, expected to be debated in federal parliament next year, would mandate the use of renewable energy, and ensure datacentres did not push up prices for homes and businesses. The prime minister said new developments would be required to make a positive contribution to the country’s energy transition.

After the meeting, NT’s chief minister, Lia Finocchiaro, and the Queensland premier, David Crisafulli, both claimed wins. Finocchiaro said gas from the massive Beetaloo basin project would now be available for datacentre power, while Crisafulli said his government could control the energy mix due to state-owned systems.

But on Friday, Bowen said there would be no carve-out for any state or territory.

“The Commonwealth, as we always said we would, will be legislating nationally consistent commonwealth legislated datacentre standards, which will require in every state and territory 100% renewables, backed by firming,” Bowen said.

“That was the case, is the case, will continue to be the case.

“The only change or concession made is that where a state-owned government instrumentality feels they can provide the energy cheaper than renewables. They can apply for exemption, but the Commonwealth will decide whether to grant that or not.”

The Australian Energy Regulator will be required to consider every application, with state or territory governments obliged to prove a non-renewables option is cheaper.

Bowen called that “a very hard thing to do”.

“Any suggestions of a wholesale carve-out for Queensland and Northern Territory is not accurate,” he said.

After the talks in Sydney, Albanese described the decisions taken as allowing flexibility for governments with state-owned power systems.

A communique signed by the leaders indicated further consultation, with the federal government continuing work on “consistent mandatory standards” for energy, water and land use.

The meeting followed the latest forecast from the Australian Energy Market Operator showing datacentre power use is projected to increase seven-fold over the next decade.

Bowen told the National Press Club earlier this month that the federal government would override state governments that oppose new national rules on datacentres, using powers in Australia’s constitution.

Separately on Friday, Bowen released the latest quarterly data on Australia’s carbon emissions, showing a 1.6% fall in the year to March 2026, led by solar, wind and batteries that have replaced coal and gas generation.

The fall reflects a 5.6m tonne cut in electricity emissions, as well as a 300% increase in battery power discharge.

Bowen said there was more work to do in transport and still “a long way to go” in the overall transition.

So far, emissions are down 25% on the June 2005 baseline, as Labor works to achieve a 43% reduction by 2030. The government’s longer-term emissions reduction target is a 62%-to-70% cut by 2035.