Malaysia mulls requiring data centre operators to generate own power
Malaysia's Deputy Energy Transition and Water Transformation Minister has proposed requiring data centre operators to generate their own electricity, as the government reviews the sector's energy and water use. The proposal follows a gap between contracted maximum load and actual consumption, with 4
KUALA LUMPUR (Oct 13): Deputy Energy Transition and Water Transformation Minister Datuk Seri Abdul Rahman Mohamad is proposing the government require data centre operators to generate their own electricity, as part of a review of the sector's energy and water consumption.
The Energy Commission (ST) is studying the actual electricity needs of data centres, following a gap between their contracted maximum load and actual consumption. As at August 2026, 45 of the 62 data centres that had signed electricity supply agreements had begun operations. The operational facilities had a combined maximum load of six gigawatts (GW), but their actual electricity consumption stood at about 1.37GW.
Abdul Rahman said he had proposed that operators develop their own power generation facilities, allowing them to choose energy sources such as solar power and battery storage. The government is also considering requiring data centres near ponds or other water sources to develop their own water supply systems for on-site use, to prevent them from affecting water availability for other consumers.
He said the ministry was examining the sector's actual resource needs and whether some data centres would bring meaningful benefits to the country. Meanwhile, the government is accelerating renewable energy development, targeting renewable sources to account for 35 per cent of installed capacity by 2030 and 70 per cent by 2050.
As at Sept 1, 2026, renewable energy accounted for nearly 32 per cent of Malaysia's installed capacity, or about 14,000MW. Another 10,000MW to 11,000MW of renewable energy capacity is expected to come online by 2030, based on announced programmes and private-sector plans.
