The National Tech Association of Malaysia (Pikom) has identified nuclear and solar energy as viable long-term options to sustain the country’s expanding data centre industry.
This proposal comes as the sector faces increasing power requirements amidst a shifting global energy landscape.
Pikom chairman Alex Liew noted that while the sector is currently stable, the high energy consumption of data centres necessitates a look toward alternative power sources. Speaking at the launch of the ‘Beyond Compliance:
The State of Cyber Resilience in Malaysia 2026′ report, Liew suggested that the existing grid could face future pressure if it remains solely dependent on current sources.
He explained that relying on solar and nuclear energy would serve to complement the existing energy mix, which includes hydro, coal, and gas.
Liew specifically pointed out that nuclear energy could be a more efficient option for ramping up power capacity compared to other alternatives.
Managing the national power grid
The rapid growth of the data centre sector in Malaysia has sparked concerns regarding the national power grid, especially given global energy uncertainties.
Projections indicate that energy consumption for data centres could exceed 5,000MW by 2035, which accounts for approximately 40 percent of the current power capacity in Peninsular Malaysia.
Addressing these concerns recently, Prime Minister Anwar Ibrahim assured that the national grid remains capable of supplying sufficient power for projects that have already been approved.
However, the government has begun tightening the approval process for new data centres to mitigate potential strain on both electricity and water supplies.
Liew emphasized that because building new power plants or upgrading existing facilities is a time-consuming process, it is essential for the nation to consider alternative energy sources early to stay ahead of demand.
Rising costs of hardware components
Beyond energy concerns, the technology sector is also grappling with significant price increases for essential computer components.
Liew highlighted that the costs of memory devices (RAM) and storage drives (SSD) have surged due to global uncertainty and the massive demand generated by artificial intelligence.
Current production capacity for these components is being increasingly redirected toward AI and server requirements, which has squeezed the supply available for other uses.
Liew warned that this trend is likely to eventually affect the pricing and availability of various semiconductor chips.
According to Liew, the price of RAM has seen a dramatic increase since late last year, rising from RM30 to RM100 in some instances.
These cost hikes are being passed on to consumers, as manufacturers and service providers find themselves unable to absorb the additional expenses.
