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Biman Mukherji

As Asia-Pacific nations gear up to embrace the artificial intelligence boom, the explosive growth in energy-intensive data centres that will come hand in hand is generating concerns about the region’s clean energy transition.
From Singapore to India, nations are looking to keep more sensitive data within their borders as risks abound in a world fraught with geopolitical tensions including those between the world’s two largest economies, the US and China.
The push to store and process data domestically will ramp up demand for data centres, which put enormous pressure on resources such as land, water and particularly energy.
This begs the question: can the region’s renewable energy capacity expand rapidly enough to meet the increased demand and still achieve net-zero goals?
According to a Moody’s report published last month, data centres in the Asia-Pacific region are expected to double in capacity by 2028.
The capacity in emerging data centre markets, including India, Indonesia, Malaysia, Thailand and the Philippines, will record growth rates of 29 per cent to 48 per cent through 2025, given their smaller existing capacities, the report said.

New entrants into the markets are likely to tap non-renewable sources of energy to meet these data centres’ massive power needs, introducing a new layer of carbon transition risks, the report added.
That does not bode well for a region that still meets the bulk of its energy needs through fossil fuels including coal, gas and diesel.
One obvious temptation for many nations could be to switch to relatively cleaner power sources such as natural gas, but climate activists say that is far from an ideal solution since they can still contribute to emissions and perpetuate reliance on fossil fuels.
So can anything be done to mitigate these data-driven emissions?
Some countries such as Australia and Singapore have mandated that new data centre capacity must adhere to certain guidelines for minimising emissions.
Singapore ended a moratorium on data centres in January 2022 but indicated that data centres within its borders must meet energy efficiency guidelines, likely translating to longer-term and higher demand for renewable energy.
While the pace of data localisation may vary from country to country, a slew of nations in the region are likely to take a leaf out of Singapore’s playbook.
The challenge, however, is that renewables are intermittent in nature, posing a challenge for data centres that require a constant stream of steady and reliable energy. Power grids in many parts of the region are not yet fully capable of integrating large amounts of renewable energy, experts said.
Despite the challenges, a range of innovative solutions are promising to alleviate this issue, including energy storage technologies for renewables.

Governments can also invest in hybrid energy solutions that combine renewable energy with fossil fuel power and invest in the modernisation of their power grids.
Blessed with abundant sunshine, wind and long coastlines, the region has huge potential for generating renewable energy.
India, China, Japan, and Australia, have been consistently expanding their renewable energy capacity through policies to reduce carbon emissions.
“It varies from country to country but, overall, several countries in the region are well positioned to make this happen,” said Carlos Torres Diaz, head of gas and power markets research at Rystad Energy.
China’s expansion of solar and wind power capacity this year is expected to give it the potential to start displacing some coal power generation, while India’s reliance on coal power is set to continue in the short-term as power demand outpaces renewables generation, he added.
“Countries need to set clear targets for renewable energy capacity and set in place the right incentives for developers,” said Diaz, adding that developers need clear market rules and mechanisms to ensure projects are profitable.
Vineet Mittal, chairman of India’s renewables energy firm Avaada Group, also expressed optimism about renewables taking on a bigger share of the energy burden generated by AI-driven technologies.
“While there is potential for an increase in fossil fuel consumption due to the expansion of energy-intensive data centres, the Asia-Pacific region also has significant opportunities to integrate more renewable energy sources,” Mittal said.
AI has the potential to drive a slew of daily activities from education to financial services that could open up access to remote communities. But clearly, its use must be aligned with climate goals, otherwise the cure may become worse than the malady.


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Renewable energy

AI-driven data centre expansion tests Asia-Pacific’s renewable energy readiness

A Keppel employee poses for photos during a tour of their rooftop solar panels at their Keppel Bay Tower office building in Singapore. REUTERS/Edgar Su

Aerial view of a small solar farm in Puchong, Malaysia. Photo: Shutterstock

A data centre of China Mobile in southwest China’s Guizhou Province. Photo: Xinhua

Singapore’s uber-rich foreigners shun extravagance, spooked by wealth scrutiny

Sentosa Cove private residential housing on Sentosa Island in Singapore in 2023. Photo: AFP

Singapore stepped up surveillance on wealth in the aftermath of a S$3 billion money-laundering case last August. Photo: Shutterstock

Sentosa Golf Club in Singapore. Demand for high-end homes, cars and golf memberships in the city state has fallen due to a confluence of reasons, industry observers say. Photo: Reuters

Dark clouds ahead as Indonesia’s emissions surge from Asia’s need for data centres, Singapore’s offshore push

Buildings seen shrouded in smog in Jakarta last month. Indonesia’s capital is one of the fastest-growing hubs in the Asia-Pacific for energy hungry data centres. Photo: Bloomberg

The Babelan coal-fired plant in Bekasi. Most of the round-the-clock electricity that data centres in Indonesia require comes from coal-fired plants. Photo: Bloomberg

In 2020, Singapore’s more than 70 data centre facilities were found to account for 7 per cent of total energy consumption in the city state. Photo: Reuters

Haze blankets the main business district in Jakarta last month, when it was named the most polluted city in the world. Photo: AP

An IT specialist walks past servers. Most data centres in Indonesia are reliant on PLN, the state-owned electricity firm, unless they build their own power plants or install solar panels. Photo: Shutterstock

As India eyes a US$1 trillion digital boom, will it spawn a data-driven resource crunch?

Electricians work on a pylon in New Delhi. In the three years to 2022, the amount of electricity required by India’s data centres more than doubled to 722 megawatts. Photo: AFP

Labourers work on a construction site in Mumbai last month. Data centres are putting growing pressure on power and water infrastructure as they increasingly crop up in India’s major metro areas. Photo: AFP

Singapore imposed a three-year moratorium on new data centres in 2019 and now only allows facilities subject to conditions on energy efficiency and sustainability. Photo: Reuters

Chinese-linked nickel miners in Indonesia accelerating deforestation, threatening indigenous Bajau people: report

Excavators in a pit at a nickel mine in Morowali Regency, Central Sulawesi, Indonesia. Photo: Bloomberg

Aerial picture taken on May 14, 2023, of PT. Indonesia Morowali Industrial Park (IMIP), one of the biggest nickel producers in Sulawesi. Photo: AFP

Young Bajau laut children paddling a boat near stilted houses off the coast of Borneo. Photo: Shutterstock

Steam rises from PT Vale Indonesia’s nickel processing plant in Sorowako, South Sulawesi, Indonesia. Photo: AP

Is Southeast Asia set for a green energy revolution powered by small solar panels and EVs?

An electric vehicle (EV) being charged while on display at the Bangkok EV Expo 2024 on February 11, 2024. Photo: EPA-EFE

Workers put up a panel on the rooftop of a residence in Gurugram on the outskirts of New Delhi, India, on February 20, 2024. Photo: AP

This Week in Asia

Opinion

Asia Opinion

News

Asia

Nations will need to grapple with increases in energy demand as data centres proliferate or put their net-zero emission goals at risk


Energy

Business of climate change

Climate change

Artificial intelligence

Environment

Sustainability

India

Technology

Singapore

Indonesia

Australia

Expresses the views, ideas and conclusions of the author. (Eg. Enough of Crazy Rich Asians, think of crazy poor Hongkongers.)


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My Take

My Take | AI-driven data centre expansion tests Asia-Pacific’s renewable energy readiness

Nations will need to grapple with increases in energy demand as data centres proliferate or put their net-zero emission goals at risk