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Rising electricity demand driven by data centres, official

says

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Country has fastest rising data centre demand in region,

report

shows

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Gas-fired power capacity to rise by around 50% by 2030,

state

utility CEO says

By Sudarshan Varadhan and Ashley Tang

KUALA LUMPUR, June 18 (Reuters) - Malaysia is expected

to add 6-8 gigawatts of gas-fired power by 2030 to address

growing electricity consumption driven by demand from data

centres, an industry official said.

The country is expected to see the fastest surge in data

centre power demand in southeast Asia, with its share of

electricity consumed by data centres in the region to triple to

21% by 2027 from 7% in 2022, a joint report in May by Bain & Co

with others including Google and Temasek showed.

Rising gas demand could see Malaysia, the fifth-largest

exporter of liquefied natural gas (LNG), start importing the

super-chilled fuel in four to five years, the head of state

energy firm Petronas told the Energy Asia conference this week.

Megat Jalaluddin, CEO of state utility Tenaga Nasional

Berhad, said he expects Malaysia to add 6-8 gigawatts

of gas-fired power by building new plants and extending the life

of existing ones as it looks to cut dependence on coal.

That represents a 40-54% increase from the current 15 GW of

gas-fired capacity. Total power consumption in Malaysia is on

track to increase 30% by 2030, and Malaysia has already invited

industry proposals for supply, he said.

"We want to phase out coal responsibly. Then the next best

option that can basically take the place of coal is gas," he

told Reuters on the sidelines of the Energy Asia event.

Malaysia could also add as much as 10 GW of renewable

capacity by 2030, more than doubling the 9 GW currently, as data

centres push for access to cleaner sources of power, he said.

In the last two years, Malaysia has turned to its coal-fired

power plants to address surging demand which grew at the fastest

pace in 14 years in 2024, according to energy think-tank Ember.

Data centres are expected to require 19.5 GW of power

generation capacity by 2035, accounting for 52% of Peninsular

Malaysia's electricity use, from about 2% now, Deputy Prime

Minister Fadillah Yusof told Reuters.

Technology giants including Microsoft ( MSFT ), Nvidia ( NVDA ), Alphabet's

Google and ByteDance have announced billions of dollars in

investments in Malaysia since the beginning of last year,

powering an infrastructure boom.

Malaysia's southern state of Johor has emerged as Southeast

Asia's hottest data centre hub due to its proximity to

Singapore, relatively cheap land and power and faster approvals,

real estate consultancy Knight Frank said in a report.

(Additional reporting by Michele Pek in Singapore

Editing by Tony Munroe and Elaine Hardcastle)