National Cabinet must commit to lifting nuclear bans
National Cabinet will meet tomorrow, with the development of nationally consistent rules for powering data centres on the agenda. We are calling on National Cabinet to commit to removing the Commonwealth prohibition and relevant state bans on nuclear energy.
Data centres are the factories of the current industrial revolution. It is important that Australia capitalises on the rush by technology companies to develop data centre capacity here. Building here gives us the ability to impose clear conditions, including protecting Australia’s digital sovereignty, minimising environmental impacts and delivering tangible benefits to local communities. We discussed these issues in a previous blog, which you can read here.
Data centres require enormous amounts of electricity. The Australian Energy Market Operator forecasts that their electricity consumption in the National Electricity Market could rise from approximately 5 terawatt-hours in 2025–26 to 34 terawatt-hours by 2035–36. That would represent approximately 13% of all electricity supplied through the NEM.
Meeting this demand with fossil fuels would be a betrayal of the Australian people. It would increase air pollution and its associated health impacts while locking in higher emissions and worsening the climate crisis.
The Albanese government says new data centres will be required to be powered by new renewable generation. This sounds good in principle, but in practice it is neither accurate nor likely to be feasible.
At the National Press Club, Climate and Energy Minister Chris Bowen said data centres would be required to support new renewable generation. But he then said that data centres need “renewables, backed by storage and gas peaking”. So what he meant to say was that data centres would be required to support new renewable and fossil generation.
The government may require data centres to purchase renewable energy certificates equivalent to their electricity consumption. This could help finance additional renewable projects, but certificates are an accounting mechanism. They do not mean that every megawatt-hour consumed by a data centre was generated by renewables, particularly when gas-fired generators are being used to maintain supply.
So which is it, Minister? Will these data centres actually be powered entirely by renewables, or will they be powered by renewables backed by fossil fuels? It cannot honestly be described as both.
It’s time to stop lumping gas in with clean power
Minister Bowen has also argued that gas-fired generators produce no emissions when they are not operating. That is true only if we restrict the analysis to what comes out of the power station’s smokestack.
Gas has an entire fuel cycle before it reaches a power station. Greenhouse gases are released during extraction, processing, venting, flaring, compression, storage and transmission. Methane also leaks from wells, processing facilities, valves, pipelines and other infrastructure. The Australian government’s own greenhouse accounting recognises these fugitive emissions.
Those emissions do not simply disappear whenever a particular gas turbine is switched off. The supply chain must remain operational to ensure fuel is available when the generator is called upon, and that system continues to produce fugitive emissions.
A credible comparison must therefore consider the full lifecycle of gas, not merely combustion emissions during the hours in which a generator is operating.
Gas peaking may produce fewer emissions than running a gas plant continuously, but the sort of gas plants that can ramp up the quickest to fill gaps in demand are less efficient, and therefore more emissions intensive, than the sort that run continuously. A system that remains dependent on fossil gas remains responsible for combustion emissions when generators operate and upstream emissions across the gas supply chain.
The reality is that the government remains committed to the electricity system outlined by AEMO: renewable generation connected by expanded transmission, firmed by storage and backed by fossil gas. AEMO’s 2026 Integrated System Plan retains gas-fired generation through 2050.
The absurdity of banning clean power while demanding clean power
At the same time, Minister Bowen and the Albanese government continue to reject nuclear energy, refusing to consider even the preliminary step of removing the Commonwealth prohibition. Nuclear power is also prohibited under legislation in several states.
The government argues that nuclear energy would take too long and cost too much. But that argument makes little sense in the context of data centres, which are themselves long-term projects.
If governments can require technology companies to support new renewable generation, they could also allow them to support new nuclear generation. It is entirely within the Australian government’s power to require data centres to pay for additional clean energy capacity and let developers determine what combination of renewables and nuclear provides the best solution for their project.
The argument about delay is also questionable when the government’s preferred pathway retains fossil gas through 2050. If the objective is to stop burning fossil fuels for electricity, permanently excluding one of the world’s largest and most reliable sources of clean energy deserves much greater scrutiny.
Then there are the practical realities of powering a modern economy, especially continuous loads such as data centres, with variable sources such as wind and solar.
Hypothetical examples
Consider an illustrative hyperscale data centre requiring a continuous 2 gigawatts of electricity. What would be required if it were theoretically powered by a single source of clean energy on an isolated grid?
Under a simplified scenario in which solar generates at full output for six hours each day, approximately 8.7 GW of solar would be required. Two gigawatts would directly power the data centre during those six hours, while the remaining 6.7 GW would charge batteries to power it during the other 18 hours (assuming battery round-trip efficiency of 90%).
This would require approximately 36 GWh of usable battery storage, or around 40 GWh of nameplate capacity after allowing for losses. The solar farms would occupy approximately 173–208 square kilometres, roughly four times the area of Sydney Harbour.
Even this is an idealised daily-cycle calculation. A genuinely isolated solar system would require additional generation and storage to withstand successive cloudy days and the worst periods of winter solar production.
Powering the facility with onshore wind alone is even more complex. Wind has a less predictable generation profile and can fluctuate from near maximum output to very low output across large areas.
If we assumed that a geographically dispersed wind fleet never fell below 10% of its installed capacity, approximately 20 GW of wind would be required to guarantee 2 GW at that minimum output. The wind farms would extend across approximately 491–11,290 square kilometres, depending on turbine spacing and project design, while the turbine foundations, access roads and other infrastructure would directly occupy around 60 square kilometres.
But this still would not provide genuinely firm supply. If wind output fell below 10%, the data centre would experience a shortfall. No finite amount of wind capacity can guarantee continuous supply without storage if output can approach zero.
Australia experiences wind droughts in which output can remain below 10% of capacity for several days. A more credible theoretical system could therefore combine approximately 11.4 GW of geographically dispersed onshore wind with a long-duration storage system comparable to Snowy 2.0.
Snowy 2.0 will provide 2.2 GW of generating capacity and 350 GWh of stored energy. It could theoretically supply a 2 GW data centre for a week without wind generation (as long as powering the data centre is always the first priority).
The 11.4 GW wind fleet would extend across approximately 280–6,447 square kilometres, although the turbines, roads and associated infrastructure would directly occupy only around 34 square kilometres. Including Snowy 2.0’s permanent operational footprint would bring the combined direct footprint to approximately 35 square kilometres. This excludes transmission and Snowy 2.0’s larger temporary construction footprint.
Nuclear power is considerably simpler.
One illustrative configuration would use three 1.1 GW reactors, providing 3.3 GW of installed capacity. Two reactors would operate while the third was maintained as a reserve. If one operating reactor tripped, the remaining reactor would provide 1.1 GW while storage supplied the temporary 900 MW shortfall until the reserve unit reached the required output.
Approximately 1–1.2 GW of battery discharge capacity and 12–15 GWh of storage would provide around 12 hours of conservative bridging capacity. The precise requirement would depend on the reactor design, the condition in which the reserve unit was maintained and how quickly it could safely begin supplying electricity.
The entire nuclear site would occupy approximately 8–10 square kilometres, excluding the battery site and transmission.
Top: First Small Modular Reactor being built in Ontario, Canada. (OPG) Bottom: Vogtle nuclear power station. Georgia, USA (Georgia Power)
In reality, a data centre would likely not operate as an isolated grid powered by a single source. It would connect to a broader electricity system containing multiple generators, storage technologies, transmission links and flexible loads. The examples above are intended as a thought experiment rather than complete engineering designs.
What they demonstrate is that meeting the Albanese government’s proposed renewable energy requirements would involve substantial new generation, storage, transmission and land for every major data centre. Including nuclear energy could substantially reduce the amount of generating capacity and storage required while dramatically reducing the electricity system’s overall land footprint, leaving more space for nature.
That is why we are calling on National Cabinet to commit tomorrow to removing the Commonwealth prohibition and relevant state bans on nuclear energy.
New data centres should be required to support the construction of genuinely additional clean energy, whether renewable, nuclear or a combination of both, with clear timelines to meet their electricity needs entirely from clean sources as soon as practicable, without increasing household electricity prices or placing additional pressure on the grid.
Science and environmental outcomes, not dogma, should determine which technologies are allowed to contribute.