SYDNEY — Prime Minister Anthony Albanese announced a comprehensive national artificial intelligence framework during a speech at the University of Sydney on Wednesday, unveiling new regulatory measures for datacentres, intellectual property protections, and the immediate creation of a federal Office of AI. The plan aims to balance economic opportunity with environmental and community safeguards, positioning Australia to harness AI’s potential while mitigating risks to energy security, household affordability, and creative rights.

Albanese said the federal government will establish an Office of AI within the Department of the Prime Minister and Cabinet with immediate effect. The office will coordinate AI policy across government departments and design new national standards for the development and deployment of artificial intelligence systems. "No government can turn back the clock or press pause on AI developments," Albanese said. "Pressing pause on AI would only mean cutting Australia off from the opportunities that are there to be seized."

A central pillar of the framework targets large-scale datacentres, which are projected to expand rapidly as global AI demand surges. Albanese stated Australia will create a legal obligation for these facilities to underwrite new power supply. Additionally, large-scale datacentres will be legally required to pay their full share of grid connection costs and to add as much energy to the grid as they consume.

The new standards will also require operators to minimize water usage and ensure their operations do not increase household power prices. "The government must adequately regulate datacentre growth to ensure it occurs in the best interests of Australians," he said.

The prime minister emphasized that the framework includes faster approval processes for AI projects, including datacentres, arguing that clear and efficient regulation will enhance Australia’s appeal to international investors. "Getting the AI framework right will enhance Australia's appeal to international investors by delivering greater clarity and speed for approvals," Albanese stated. He added that the framework "imposes an important discipline on government" to act cohesively across portfolios.

Albanese will push parliament to consider new AI legislation in early 2027, following a period of policy development and intergovernmental consultation. Before the datacentre standards can be adopted nationally, all state and territory ministers at energy and climate change ministerial council meetings must agree to them. Queensland was the single holdout on the datacentre proposal during the May meeting of that council, raising concerns about inconsistent regulatory approaches across jurisdictions.

On intellectual property, Albanese ruled out a text and data mining exception for AI proprietors in Australia, stating, "The government rules out a text and data exemption for AI proprietors." He stressed that creators’ rights must be protected, declaring, "Anything less than the strongest possible protection for creators' works is theft." The government also confirmed it will not include AI companies in its News Bargaining Incentive, reinforcing its stance on copyright enforcement.

Albanese framed AI as both a profound challenge and opportunity, stating it surpasses even social media in scale. He likened the current moment to historical technological shifts, describing AI development as requiring a coordinated government approach similar to civil aviation in the 1920s or genetics in the 1990s. Drawing from personal experience, he recalled working as a Commonwealth Bank clerk persuading customers to switch from paper passbooks to keycards, suggesting societal adaptation to new technologies is inevitable but manageable with thoughtful policy.

Industry Minister Tim Ayres, who has been leading AI policy development alongside Assistant Minister for Science and Technology Andrew Charlton, echoed the government’s firm position on copyright. "The government has made it very clear that there won’t be a text and data mining exception in Australia," Ayres said. He added that securing AI investments is a national priority: "The government is working hard to secure AI investments because they are in the Australian national interest." Internal government documents reveal ongoing discussions with U.S. AI firm Anthropic, which has expressed concerns about copyright clarity affecting its investment plans. Treasury officials warned Finance Minister Jim Chalmers that Anthropic claimed its investment depended on clear copyright rules and liability certainty, particularly regarding licensing from a long tail of smaller rights holders.

Critics welcomed the push for national standards but urged stronger immediate action. Sarah Hanson Young, the Greens communications spokesperson, called for a moratorium on large datacentre development until comprehensive rules on energy, water, and community impact are finalized. "With more than 90 datacentres already in the pipeline, Australia cannot allow a free-for-all in the meantime," she said. In Sydney’s Lane Cove, where five datacentres are planned—occupying 40% of the suburb’s industrial land, according to the Lane Cove Responsible Planning Group—resident Sasha Titchkosky welcomed the prime minister’s recognition of the need for national regulation but insisted, "There shouldn’t be any new approvals given until the regulatory framework is established."

Environmental advocates warned of unchecked energy demand. Amanda McKenzie, chief executive of the Climate Council, stated that the AI-driven surge in datacentres "will have a profound effect on the energy system" and could lead to "soaring prices and rampant climate pollution" if not managed with clean power. She emphasized that datacentres must be powered by renewable energy to avoid increasing reliance on coal and gas. The Climate Council also cautioned that Queensland’s reluctance to endorse national standards could trigger a "state-by-state race to the bottom" on datacentre regulation.

Belinda Dennett, chief executive of Data Centres Australia, largely agreed with the prime minister’s direction but noted implementation challenges. While affirming the industry’s desire to reach 100% renewable power, she told a New South Wales inquiry in May that aligning renewable energy project timelines with datacentre construction remains difficult. "The devil will be in the detail of the new regulations," she said.

The announcement responds to Australia’s rapidly evolving AI landscape, where over 90 datacentres are already proposed and energy infrastructure faces unprecedented strain. The national defense strategy has identified AI and machine learning as the technologies with the most significant potential for technological disruption in the coming years, while intelligence ministers Tony Burke and Richard Marles are coordinating with Five Eyes allies on AI-related security threats, including AI-generated disinformation targeting democracies. Public opinion remains divided: a May Guardian Essential poll found 36% of voters saw more risk than opportunity in AI, while only 22% viewed it as more opportunity than risk. The 2027 legislative timeline gives the government time to build consensus across states and refine standards, but pressure is mounting from communities, environmental groups, and industry for clarity and action now.