Latest news with #RM184.7
The Sun
3 days ago
- Business
- The Sun
Balancing innovation and responsibility
MALAYSIA is racing toward a digital future – one powered by a booming data centre industry projected to consume over 20 GW of electricity by 2040, as forecast by the Ministry of Energy Transition and Water Transformation (Petra). This explosive growth is unlocking vast economic potential but also highlighting the way that Malaysia must balance the demands of a thriving digital economy with the environmental challenges it brings. According to Deputy Investment, Trade and Industry Minister Liew Chin Tong, Malaysia's data centre industry has witnessed substantial growth, with investments totalling RM184.7 billion from 2021 to December 2024 thanks to the increasing demand for cloud computing, artificial intelligence (AI), and digital services. Our proximity to Singapore, which imposed a moratorium on new data centres due to resource constraints, has further enhanced Malaysia's appeal. Local communities, particularly in Johor and Selangor, are seeing new employment opportunities and infrastructure development as global players establish operations in these regions. Reuters reported that the investment made by one of the world's largest technology companies in Malaysia is expected to generate approximately US$10.9 billion in new revenues over the next four years and create more than 37,000 jobs, demonstrating the sector's potential to drive national growth. The economic benefits are clear. Faced with significant opportunities for growth, it's all the more important that we carefully consider our responsibilities to the wider community, and the impacts on the places we live and work. The impact that data centres pose to the environment needs to be carefully managed. Malaysia's Ministry of Energy Transition and Water Transformation has projected that electricity demand from data centres, which require continuous power and extensive cooling systems, will reach 7.7 GW by 2030 and could surge to 20.9 GW by 2040. To mitigate these issues, the government has implemented several forward-looking initiatives. The National Energy Transition Roadmap (NETR), introduced by the Ministry of Economy, aims to achieve 70% renewable energy capacity by 2050, an ambitious leap from the current 25%. Additionally, the Corporate Renewable Energy Supply Scheme (CRESS) allows data centre operators to source energy directly from green power producers, bypassing the national grid. The significant amount of water required to cool data centres have also raised alarms. The National Water Services Commission (Suruhanjaya Perkhidmatan Air Negara/SPAN) warns that unchecked water usage by data centres could contribute to a water crisis. In response, several strategies have been adopted to manage water consumption. Water Usage Effectiveness metrics help track and promote efficient water management practices within data centres while companies have collaborated with state-owned entities to develop recycled water supply schemes, reducing reliance on potable water. There is also growing interest in alternative cooling technologies, including immersion cooling, which can significantly lower both water and energy consumption. These are important strategies, and it is critical that we continue to build on this work to ensure that we are balancing our economic growth with the urgent need for environmental stewardship. We know that collaboration between public and private sectors is an essential part of ensuring responsible growth of any sector, so it's great to see that the government has taken a proactive stance in regulating and guiding the development of data centres. The Ministry of Investment, Trade, and Industry's guidelines outline best practices for energy and water efficiency, safety, scalability, and the adoption of smart technologies. Environmental Impact Assessments are mandatory for projects with significant ecological implications to ensure new data centres consider and mitigate environmental impacts. Government incentives, including potential tax breaks, also encourage green practices such as renewable energy integration, advanced cooling systems, and efficient water usage. Beyond government action, industry stakeholders are actively contributing to responsible practices within the data centre ecosystem. The YTL Group 2024 Sustainability Report highlighted that YTL Green Data Centre Park in Johor integrates advanced technologies and energy-efficient designs including solar-powered infrastructure, advanced cooling systems, and rainwater harvesting systems to minimise environmental impact while ensuring high performance. With an expected capacity of 500MW, the park stands as a regional benchmark for balancing technological advancement with environmental responsibility. We have also seen leading global data centre providers focusing on energy efficiency to meet their carbon neutrality goals and investing in rooftop solar panels and virtual power purchase agreements for solar farms. Addressing the dual priorities of economic development and environmental sustainability requires a multi-pronged approach. One potential solution is the development of responsible data centre certification programmes. By creating a national certification that evaluates facilities on their energy efficiency, water usage, and carbon emissions, the government can incentivise more sustainable choices. Another opportunity lies in regional collaboration, where Southeast Asian nations work together to share technologies, regulatory best practices, and renewable energy resources. Investment in research and development is also crucial. Government grants and private sector initiatives can support the creation of advanced cooling systems, AI-driven energy management, and water recycling innovations tailored to Malaysia's tropical climate. Lastly, transparent reporting and environmental accountability must be prioritised to ensure measurable progress and public trust. Malaysia stands at a pivotal crossroads: the path forward must blend innovation with responsibility. By fostering collaboration across government, industry, and academia, Malaysia can lead Southeast Asia not just in digital capability, but in responsible digital leadership. Achieving this vision will require actionable policies, measurable standards, transparent reporting, and shared accountability.
The Sun
27-05-2025
- Business
- The Sun
Capitalising on data centre boom
MALAYSIA has become one of Southeast Asia's most actively pursued locations for digital infrastructure in the past two years, attracting an estimated RM278 billion in digital investments between 2021 and 2024. About RM184.7 billion of this has gone into cloud infrastructure and data centre projects, making Malaysia one of the top locations in the world for hyperscale facilities and cloud computing services. The charge is led by several American tech giants, such as Microsoft, where a US$2.2 billion (RM9.25 billion) investment was announced to construct three data centres in Malaysia by the second quarter of 2025. In addition, Google is investing US$2 billion to build its first data centre and cloud facility here, which is expected to generate 26,500 jobs and US$3.2 billion in economic activity by 2030. All indicators suggest that Malaysia's digital economy is expanding to unprecedented levels. However, the important question is whether Malaysia is reaping the benefits of this infrastructure or are we just contributing land and electricity to someone else's digital empire? Beyond the hype Data centres serve as the internet's invisible foundation. All AI queries, cloud documents, messages and searches go through their servers. Attracting them may seem like a huge victory, and in some respects, it is. They express confidence among investors in Malaysia's connectivity, energy supply and political stability. However, data centres by themselves are not major employers. Typically, a hyperscale facility may generate between 100 and 200 permanent positions, mostly in technical maintenance, security and facility management. Instead, construction, electrical work, HVAC (heating, ventilation and air conditioning) installation and supply chain services account for the majority of job growth. Microsoft projects that nearly 37,000 jobs will be supported by the investment, which will also create US$10.9 billion in downstream value over a four-year period. The true economic concern, however, is whether this value can be retained in Malaysia rather than be diverted abroad through deals, earnings and data repatriation. Digital infrastructure We are constructing the digital economy's hardware but are we also building its ownership and capabilities? This is a silent worry as Malaysia presents itself as a digital hub. Foreign corporations will profit from the majority of the data handled in these centres, which will service clients worldwide and are subjected to foreign regulations. Without meaningful stakes in the software, platforms or intellectual property layered on top of that infrastructure, Malaysia risks becoming the industrial park of the digital world: essential but easily replaceable. The idea of digital sovereignty becomes crucial at this point. We must have a national policy that guarantees that: Malaysian law regulates the data created and kept here; Cloud computing capabilities are available to researchers and local businesses; Schools prepare students for the skills of the future with cloud-native technology; And critically, rather than merely hosting foreign IT giants, we are also developing homegrown ones. Environmental cost There is also a quieter cost – energy and water. Data centres are notoriously resource-intensive. The industry is putting a burden on power systems throughout the world as each factory uses energy that frequently exceeds 100MW. Electricity rates in Malaysia are anticipated to increase by 14.2% in July 2025. Some businesses are already looking into solar and other options but it is crucial that the ecosystem as a whole follow suit to pursue a sustainable economy. Constructing more than server rooms Malaysia's data centre boom can be revolutionary only if it is a component of a larger and strategic digital industrial policy. Here is how we can become a digital leader instead of just being a data landlord: Ensure local involvement in high-skilled operations like data analytics, AI services and cybersecurity. Take advantage of tax breaks for R&D, startup incubation and local cloud services in addition to construction. Include goals for renewable energy in all digital infrastructure projects to meet global ESG standards. Increase collaborations between academia and businesses by integrating instructors and students into cloud and data science settings. While policymakers should be optimistic about the billions pouring into Malaysia's data centre industry, it is also one that raises questions worth considering. Who is the data owner? Who truly benefits from this expansion? And who is shaping the policies that will govern our digital future? Malaysia is in a unique position to take the lead in Southeast Asia's digital revolution. However, including more vision, value and sovereignty into our digital strategy will be the key to leadership, not adding more servers. If we do not explore these questions now, we may discover a decade from now that we have built the highways to the cloud but left our people stuck on the ground. Galvin Lee Kuan Sian is a lecturer and programme coordinator for the Diploma in Business programme at the School of Diploma and Professional Studies, Taylor's College.
Rakyat Post
15-05-2025
- Business
- Rakyat Post
Malaysia's Data Centre Boom: Building For The Future, Or Just Hosting It?
Malaysia has become one of Southeast Asia's most actively pursued locations for digital infrastructure in the past two years, attracting an estimated RM278 billion (USD59.4 billion) in digital investments between 2021 and 2024. About RM184.7 billion (USD39.4 billion) of this has gone into cloud infrastructure and data centre projects, making Malaysia one of the top locations in the world for hyperscale facilities and cloud computing services. The charge is led by several American tech giants, such as Microsoft, which announced a RM10.2 billion (USD2.2 billion) investment to construct three data centres in Malaysia by the second quarter of 2025. Google is also investing RM9.3 billion (USD2 billion) to build its first data centre and cloud facility here, expected to generate 26,500 jobs and RM14.9 billion (USD3.2 billion) in economic activity by 2030. All indicators suggest that Malaysia's digital economy is expanding to unprecedented levels, but the more important question is whether Malaysia is actually reaping the benefits of this infrastructure—or if we are simply contributing land and electricity to someone else's digital empire. Beyond The Hype: What's Actually Being Built? Data centres serve as the internet's invisible foundation. All AI queries, cloud documents, messages, and searches go through their servers. Attracting them may seem like a huge victory—and in some respects, it is. They express confidence among investors in Malaysia's connectivity, energy supply, and political stability. However, data centres by themselves are not major employers. Typically, a hyperscale facility may generate between 100 and 200 permanent positions, mostly in technical maintenance, security, and facility management. Instead, construction, electrical work, HVAC (Heating, Ventilation, and Air Conditioning) installation, and supply chain services account for the majority of job growth. Microsoft projects that nearly 37,000 jobs will be supported by its investment, which is also expected to create RM49.4 billion (USD10.9 billion) in downstream value over a four-year period. The true economic concern, however, is whether we can retain this value in Malaysia—or if it will be diverted abroad in the form of deals, earnings, and data repatriation. Digital Infrastructure Without Digital Sovereignty We are constructing the digital economy's hardware—but are we also building its ownership and capability? This is a silent worry as Malaysia positions itself as a digital hub. Foreign corporations will profit from most of the data handled in these centres, which will service global clients and be subject to foreign regulations. Without meaningful stakes in the software, platforms, or intellectual property layered on top of that infrastructure, Malaysia risks becoming the industrial park of the digital world: essential, but easily replaceable. The idea of digital sovereignty becomes crucial. We must have a national policy that guarantees: Malaysian law regulates the data created and stored here; Cloud computing capability is accessible to researchers and local businesses; Schools are preparing students with cloud-native technology and future-ready skills; And critically, rather than merely hosting foreign IT giants, we are also building Malaysian ones. The Environmental Cost Of Progress There is also a quieter cost—energy and water. Data centres are notoriously resource-intensive. Globally, the industry is putting a strain on power systems, with each facility often using more than 100MW. Electricity rates in Malaysia are expected to increase by 14.2% in July 2025. Some companies are already exploring solar and other sustainable alternatives, but it is crucial that the ecosystem as a whole follows suit to support a greener digital economy. Ideas: Constructing More Than Just Server Rooms Malaysia's data centre boom will only be revolutionary if it is part of a broader, strategic digital industrial policy. Here's how we can become a digital leader instead of just a data landlord: Require local involvement in high-skilled operations like data analytics, AI, and cybersecurity; Extend tax breaks not just for construction but for R&D, start-up incubation, and local cloud services; Make renewable energy goals mandatory in digital infrastructure projects to meet global ESG standards; Strengthen academia-industry collaboration by integrating instructors and students into real-world data science environments. Policymakers should certainly be optimistic about the billions flowing into Malaysia's data centre industry. But the real questions remain: who owns the data? Who truly benefits from this expansion? And who is shaping the policies that will govern our digital future? Malaysia is uniquely positioned to lead Southeast Asia's digital revolution. But true leadership will require vision, value, and sovereignty—not just servers. If we do not address these questions today, we may wake up in a decade to find we've built the highways to the cloud but left our people stranded on the ground. Galvin Lee Kuan Sian serves as Lecturer & Programme Coordinator for the Diploma in Business programme at the School of Diploma & Professional Studies, Taylor's College. With more than six years of experience in secondary and tertiary education, Galvin aspires to bring the best out of every student that comes under his guidance through robust teaching and learning pedagogy. Get more stories like this to your inbox by signing up for our newsletter.
The Sun
08-05-2025
- Business
- The Sun
Malaysia: Data centres driving tech nation ambition
KUALA LUMPUR: The data centre sector can be a catalyst for Malaysia to become a technology nation, said Deputy Minister of Investment, Trade and Industry Liew Chin Tong. He said that data centres could become the largest off-takers to boost Malaysian technologies, helping the country achieve its industrial and energy transition aspirations by adopting a 'whole-of-value-chain' investment approach. 'While data centres are not new to Malaysia, the idea of Malaysia becoming a data centre hub that fulfils not only domestic usage but also external demand is relatively new. 'The new wave only took off in a big way in 2021, thanks to the entry of hyperscalers and the ecosystem around them,' he said at the Data Centre Nexus 2025 event in Bangsar today. Liew expressed hope that Malaysia could build a broad-based consensus among all stakeholders to ensure the data centre sector achieves three key objectives. He said the first objective is for the sector to grow sustainably, both financially and environmentally. 'The second objective is to enable a 'whole-of-value-chain' growth—from renewable energy sources to the local equipment supply chain, to a robust service sector that develops expertise in building and maintaining data centres. 'The third objective is that the sector's development should bring maximum benefit to Malaysia and Malaysians, maintaining the social license and broad-based public support for the sector,' he said. Liew noted that Malaysia attracted RM278 billion in digital investments from 2021 to December 2024, with RM184.7 billion allocated for data centre-related projects, including data centres, cloud computing, data hosting, and others. He also outlined three missions that the data centre sector could focus on. 'First, leading the way in the energy transition, as the world shifts away from coal to low-emission sources in power generation. 'In Malaysia, the energy transition is much slower compared to other countries. As the most important factor in the growth of energy demand, I would like to see the data centre sector become the most dynamic off-taker for renewable energy in Malaysia,' he said. Second, Liew highlighted the need for investment in a Malaysian equipment supply chain, stressing the urgent need to localise it. 'For a variety of reasons, I strongly believe that with the data centre sector as an off-taker, we could build a non-United States, non-China supply chain that will eventually serve the world. 'I would like to see the data centre sector invest in this together, creating a 'Build by Malaysia' era. More horizontal connections between the data centre sector and the semiconductor industry are something I hope to see developed as quickly as possible,' he said. Liew said the third mission is to create data centre service jobs for Malaysia and the region. 'As more and more data centres are built in Malaysia, we would like to see a concerted effort to nurture a new generation of engineers for both the construction, maintenance, and operations of the data centres,' he added. 'I would like to see more emphasis on job creation across the entire value chain of the data centre sector,' he added.
