KUALA LUMPUR, Oct. 24 (Xinhua) -- Malaysia's data-center expansion is expected to put increasing pressure on electricity supply, particularly in Johor, where power demand from new facilities could account for 18 percent of Peninsular Malaysia's electricity supply by 2031, according to BMI Country Risk and Industry Research.
BMI said in a recent note that it forecasts Johor's new data center capacity will require about 30 terawatt-hours (TWh) of electricity annually by 2031, up from a level equivalent to 6 percent of Peninsular Malaysia's electricity supply in 2026.
The additional demand would exceed 90 percent of the net increase in electricity generation expected across the peninsula over the same period.
The tight supply outlook reflects the peninsula's limited access to Sarawak's hydropower resources, while grid infrastructure development struggles to keep pace with data center construction.
BMI expects Malaysia's thermal power capacity to increase by a net 3 gigawatts (GW) between 2029 and 2031, from 33.3 GW in 2028 to 36.3 GW in 2031. Gas-fired electricity generation is forecast to rise by 13.6 TWh to 106.7 TWh.
However, it said grid connections could pose a bigger bottleneck than generation capacity, as local substations and transmission infrastructure become increasingly constrained in key data center hubs.
Although utility firm Tenaga Nasional Bhd plans to invest 43 billion ringgit in grid upgrades, major projects typically take five to 10 years to complete.
Malaysia has also tightened approval requirements for new data centers, requiring operators to demonstrate access to their own power and water supplies before connecting to the grid, according to BMI. ■
