Southeast Asia is on the cusp of a major transformation, poised to become a global hub for data centres. A new report by Ember reveals that the region’s data centre capacity is expanding rapidly, with six major economies — Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Viet Nam — emerging as hotspots. However, this digital growth comes with a significant caveat: the region’s energy systems, still heavily reliant on coal and gas, risk being overwhelmed by surging electricity demand, potentially derailing progress on energy transition goals.
Shabrina Nadhila, Electricity Policy Analyst for Southeast Asia at Ember, informs that the report’s findings are stark. Data centre electricity demand is set to skyrocket, particularly in Malaysia, where it could rise from 9 TWh in 2024 to a staggering 68 TWh by 2030 — about 30 percent of the country’s projected power consumption, and more than the total electricity Singapore consumed in 2023. Without interventions, emissions from Malaysia’s data centres alone could surge sevenfold, reaching 40 MtCO2e by the end of the decade. The Philippines and Indonesia also face sharp increases in emissions, further complicating the region’s climate ambitions.
Yet, amid these challenges, the report highlights a critical opportunity: up to 30 percent of ASEAN’s data centre electricity demand by 2030 could be met by solar and wind power — without the need for battery storage, a common concern in clean energy deployment. This insight underscores the feasibility of greening data centres if policies, market structures, and infrastructure are aligned.
What’s holding the region back? Several structural issues persist:
Policy Gaps: National frameworks for data centre sustainability are either lacking or underdeveloped, creating uncertainty for investors and operators.
Market Access: While large tech firms can leverage Power Purchase Agreements (PPAs) to secure renewable energy, smaller players face limited options. Virtual PPAs and green tariffs remain underutilized, restricting the broader shift to clean power.
Energy Efficiency: Despite its importance, efficiency is not yet central to data centre design and operations across the region. Embedding best practices from the start could significantly curb electricity use and emissions.
The report’s authors call for a multi-pronged approach: supportive policies, robust market mechanisms, clear national frameworks, and stronger collaboration between governments and industry. Without these measures, ASEAN’s data centre boom risks locking the region into a high-carbon trajectory at odds with its energy transition goals.
In conclusion, Southeast Asia’s data centre expansion is both an opportunity and a risk. The digital economy can thrive while advancing the clean energy transition — but only if governments act decisively to scale up renewables, reform markets, and embed efficiency. The stakes are high: whether the region’s digital future fuels a clean energy revolution or entrenches fossil fuel dependency depends on the choices made today.
GreentechLead.com News Desk