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KUALA LUMPUR - Electricity consumption by the data centre sector is expected to increase significantly to 31% - equivalent to 73,274 gigawatt-hours (GWh) - by 2035, up from 7% or 10,544 GWh in 2026.
The Ministry of Energy Transition and Water Transformation (PETRA) said the figures are based on projections by the Electricity Supply and Tariff Planning and Implementation Committee (JPPPET). According to the ministry, the rapid growth of the artificial intelligence (AI) and data centre industries has led to an increase in the country's peak electricity demand.
"Peak demand in Peninsular Malaysia is projected to grow at a compound annual growth rate (CAGR) of 5.1% between 2026 and 2035, rising from 21.3 GW in 2026 to 33.5 GW by 2035," the ministry said in a written parliamentary reply dated June 30, published on the parliament website.
The ministry was responding to a question from Chong Zhemin (PH-Kampar) regarding the country's readiness to meet rising electricity demand from data centres and the AI industry. In this context, the ministry said the government, together with the Energy Commission (ST), is implementing several measures to ensure a stable and reliable electricity supply.
These include identifying and extending the operation of existing thermal power plants as a short-term solution, as well as conducting open bidding by the Energy Commission to add gas-based generation capacity to strengthen Peninsular Malaysia's baseload power generation. In addition, the ministry said that through the Corporate Renewable Energy Supply Scheme (CRESS), data centres have the option of purchasing renewable energy directly from private developers via the third-party access system.
The government is also developing Large Scale Solar (LSS) projects under the LSS5 and LSS5+ programmes, which aim to add a total of 4 GW of renewable energy capacity to Peninsular Malaysia's electricity supply system. The government is also encouraging data centres to generate their own electricity based on their individual demand requirements instead of relying entirely on the national grid.
"Through this approach, data centres can reduce their dependence on the grid, thereby helping to ensure the continued stability of the national electricity system," the ministry said.
At the same time, the government, through the Data Centre Task Force (DCTF), continues to adopt a stringent screening process for new data centre applications and proposals to expand the capacity of existing facilities.
This strategic coordination is being carried out systematically to support the sustainable, competitive, strategic and investor-friendly development of Malaysia's data centre ecosystem. "Approval for new data centre applications will only be granted if they are aligned with local grid capacity planning, without ever compromising the safety, security and reliability of electricity supply to the public," the ministry added. - BERNAMA
