Submission – Inquiry into artificial intelligence and data centres

Australia has an opportunity to harness the current surge in data centre investment to contribute to the economy, technological innovation and research capability. This will require policy settings that capture longer-term benefits domestically rather than flowing entirely offshore. 

This submission proposes conditions that could be placed on hyperscalers and data centre operators’ investment to support Australian research and development (R&D).

Artificial intelligence (AI) is defined by CSIRO as “a collection of interrelated technologies used to solve problems autonomously and perform tasks to achieve defined objectives without explicit guidance from a human being.” 

Data centres are physical facilities that provide the power, cooling, connectivity and physical infrastructure needed to house both data storage and computing equipment, depending on the clients of the data centre. This equipment can support a broad range of digital services, such as cloud storage, online banking and artificial intelligence tools.

Data centres underpin essential digital services for government, business and society, in areas such as health care, finance and national security. Australia’s data centre industry is rapidly accelerating, driven by advances in artificial intelligence requiring large datasets and computing capacity to train AI models. These AI workloads, particularly large-scale model training and real-time inference, are more energy and data intensive than traditional computing, which places new pressures on infrastructure scale, reliability and energy supply.

Alongside this, the Australian Government has a significant opportunity to demonstrate leadership through sustained investment in Australian AI capability. Without that investment Australia risks becoming a major host for global data centre infrastructure while lacking a comparable sovereign AI capability of its own. This will limit the nation’s ability to harness the benefits of responsible AI adoption and increase exposure to shifts in the geopolitical and technology landscape.

The Academy recommends:

• data centre operators be required to invest in local R&D capability development. This could include a levy, with the revenue invested in public national computational infrastructure and/or AI research.
• data centre operators are required to: (a) ensure researchers can move data between storage facilities with no costs, waiting periods or technical barriers, and (b) ensure researchers retain ownership of intellectual property.
• data centre and AI infrastructure developers contribute to trusted public data and knowledge infrastructure, including scientific data repositories, metadata standards, provenance mechanisms and long-term stewardship of publicly accessible information resources that underpin AI development and scientific discovery.
• implementation of the Australian Government’s expectations of data centres and AI infrastructure developers includes transparent assessment criteria such as measurable reporting obligations, independent assurance, and clear consequences for misaligned actions. Proposals failing to meet the expectations should not be considered by government.
• the Australian Government undertake strategic planning and targeted investment in next-generation high-performance computing and data (HPCD) infrastructure.