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Australia's Labor government faces local community and political backlash over its data center expansion policy.

Growing uncertainty in Australia's policy environment, delayed approval cycles for industrial parks, and mounting pressure on the Asia-Pacific region's development pace.
Trade pressSlicast · June 22, 2026 04:40 · Australia · Source: Google News
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Image / Slicast · Source: GNews/au: "data centre" Australia (power OR grid OR AEMO)

When progressives and populists agree on an issue, it leaves government caught off guard. (ABC News)

If you want to find out where the next frontier of political and social conflict lies, it's usually worth listening to what the far left and far right politicians are saying.

Last week, while everyone's attention was focused on Pauline Hanson calling for a monoculture, attacking mainstream media, and criticizing Australian workers for being lazy, another part of her carefully orchestrated speech went largely unnoticed.

The country's now-most-popular prime ministerial candidate also used the press club speech to tap into growing Australian anxieties about artificial intelligence's impact on employment, promising "mechanisms" to protect workers and calling for stronger regulation of AI.

The fact that she mentioned artificial intelligence in her speech clearly demonstrates how acute this populist leader is in detecting the anxieties facing Australians. She warned that many unknowns about this technology require "enforceable safeguards."

While she talks extensively about workers' issues in her calls for industrial relations reform, she is strategic in focusing on workers' concerns about how AI will affect their jobs—and their children's jobs.

And this anxiety is not limited to what AI will do. It also involves the various dimensions that come with it.

Meanwhile, the Greens have been campaigning against the rapid growth of data centers, claiming they put strain on power supply, water resources, and local communities.

The Albanese government has been keen to suggest it is learning lessons from other countries and getting ahead of possible opposition. (Reuters: Clodagh Kilcoyne)

These appear to be different debates, but they are not. One is about what AI does to us, the other is about the infrastructure it requires.

This is a problem for Labor. The risk is that concerns and anxieties about AI and the infrastructure behind it are rising across very different parts of the political spectrum.

Hanson is talking about employment. The Greens are talking about power and water. Australian Capital Territory independent Senator David Pocock is asking whether communities are getting sufficient returns.

In a recent speech, Coalition industry spokesperson Andrew Hastie compared the global race for AI dominance to the Cold War nuclear arms race. He emphasized that Australia faces a critical choice: either we build sovereign capabilities and shape our own technological future, or we become highly dependent on the United States, China, and major global tech companies.

All of the above are unusual allies, but all are united on a common fundamental concern.

This is a dangerous force for Labor. When progressives and populists agree on an issue, it leaves government caught off guard.

Housing and immigration have become powerful political issues. The fact that Hanson and the Greens are both focused on AI and data centers means this issue has the potential to not be a policy dilemma, but a dangerous political minefield for the Albanese government.

Former Industry Minister Ed Husic told this column that Australia is sleepwalking toward disaster. He's right.

"Mainstream Australian politics hasn't grasped this, but the fringes of the political landscape are receiving these signals and getting ready to strike," he said.

Ed Husic told this column Australia is sleepwalking toward AI disaster. (ABC News: Adam Kennedy)

"I'm increasingly hearing from people across all walks of life expressing their concerns about the pace of AI growth.

"Again, if we think the Nationals voter is attracted to the idea of being given a systematic kick in the teeth, look at how we're managing this wave of massive data center construction.

"Most local communities have absolutely no say in the building of data centers in their regions, leaving ordinary residents angry.

"When they push back, they're told these data centers are important for the economy. So if they're that important, why build them in Blacktown instead of Bellevue Hill?"

Over $150 billion has been lined up for data center development and investment in Australia, but there are questions about whether this boom will deliver benefits beyond short-term construction boosts.

On the left side of the ledger, Greens Senator David Shoebridge has called the emissions increase from new data centers a "catastrophic trend," claiming locals pay the price through soaring electricity and water bills.

In a recent speech, the Albanese government outlined its view on how to encourage AI growth—and increase data center investment supporting it—while not driving up energy costs and job losses, with responsible assistant minister Andrew Charlton suggesting the sector needs to win public trust to avoid major backlash.

This is a reasonable goal. The problem is that trust in institutions is at historic lows.

The government has been keen to suggest it is learning lessons from other countries and getting ahead of possible opposition. But if you listen to the Greens and the Nationals, it's clear this message hasn't cut through.

Both noticed that people are worried about AI and data centers; they see the eye-watering sums of money in publicity, handshakes and ribbon-cuttings, but they worry about what this new era means for their jobs and communities.

Prime Minister Anthony Albanese enthusiastically backs data center investment, including Amazon's $20 billion expansion in Sydney and Melbourne. The government argues these projects are essential for economic growth, productivity, and maximizing the benefits of AI.

In the United States, there is evidence of strong opposition that could be politically damaging. Consumers are angry about higher energy and water prices, blaming data center demand, and fears of mass unemployment are growing.

A new report concludes that Australia's surge in power-intensive AI-driven data centers is jeopardizing the country's energy transition.

Husic believes the government is making the same mistake, being overly permissive with technology and praying these companies will do right by us. He says this is not just naive, but irresponsible.

"Australia's level of trust in AI is the lowest, yet government and business keep telling Australians to adopt a technology they fear will be the end of their jobs or worse, the end of their children's jobs," he said.

Pocock is concerned the government is simply seeing the huge dollar signs that data center investment brings and hasn't stopped to really think about the benefits for Australian communities.

"If poorly planned, these behemoths could place enormous strain on electricity and water, not to mention the job displacement caused by AI, so we need to ask, where are the returns?" he said.

"Where do we have mechanisms to ensure local people can access the computing power we need to compete in the AI world?

"How do we ensure these companies don't shift all their profits offshore and pay some tax here?

"Countries like France and the UK have already established digital taxes to capture some of these benefits."

ABC's political podcast Politics Now digs deep into the biggest stories, giving you a balanced look at the strategy and decision-making hidden behind the headlines.

While the government has tried to assure people they don't need to worry about AI, many have already decided the technology is moving so fast that government can't keep up.

The risk the government faces is how to explain to people what this wave of technology means. Ribbon-cutting and regulation will not bring comfort to anxious members of the public.

We don't yet know who wins and who loses in the age of AI.

The Greens, Hanson, and Pocock understand the public is feeling concerned. The question is whether the government has noticed this is no longer about technology, but an impending political debate in which data centers serve as the perfect physical embodiment of this unpredictable new era.

Patricia Kavalieras is the presenter of ABC News Afternoon Brief, broadcast on ABC News channel Monday to Friday at 4 pm, is a weekly co-host of Party Room Podcast with Fran Kelly, and is also the host of politics and news podcast Politics Now.

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澳洲劳工政府在数据中心扩张政策上面临本地社区和政治反弹。 · Slicast