The Australian government has decided not to move forward with a new rule that would have required data centers to power a portion of their installations with renewable energy.

First reported by Bloomberg, the decision was revealed following an agreement with state leaders on a national artificial intelligence development plan, with new legislation to be introduced early next year. However, the federal government nixed the renewable energy mandate following objections from two regions.

One of the objectors, Queensland Premier David Crisafulli, said that such a mandate should be the decision of state officials, as it owns the whole power system that serves them.

“We believe that we can control our data sovereignty, protect the rights of local communities, and enable that energy mix to bring those data centers on,” Crisafulli said

During the development of the plan, the federal government had touted its intention to make data center operators pay for the energy required to power their facilities, with energy minister Chris Bowen stating earlier this month that “data centers are welcome if they bring their own additional renewable energy.”

It is expected that federal and state governments will now work collaboratively to develop consistent mandatory standards for data center energy, water and land-use, and support skills and training opportunities,” according to a statement released after the meeting.

The New South Wales government has already proposed rules that would require data centers in the state to source at least 40 percent of their energy requirements from wind energy.

Australia has seen its data center market grow significantly over recent years. It currently has approximately 2GW of installed capacity in the country, with a development pipeline of around 6GW across more than 220 planned projects.