KUALA LUMPUR (June 25) — Data centre operations in Malaysia are currently utilising only around half of their approved electricity and water allocations, according to Minister of Energy Transition and Water Transformation Fadillah Yusof.
In a parliamentary written reply on June 24, he said actual consumption remains well below approved thresholds, reflecting both phased development of data centre projects and regulatory oversight of resource usage.
Electricity Usage at 54% of Approved Capacity
As of April 2026, Malaysia’s operational data centres recorded:
Actual electricity consumption: 1,102 megawatts (MW)
Approved maximum demand: 2,050 MW
Utilisation rate: approximately 54%
This indicates that nearly half of the approved power capacity for data centres has yet to be fully utilised.
Water Consumption at 51% of Approved Demand
For water usage, data centres reported consumption of:
28.68 million litres per day (MLD) as of January 2026
Approved demand: 55.83 MLD
Utilisation rate: about 51.4%
The figures were compiled and reported to the National Water Services Commission, or SPAN Malaysia.
Regulatory Oversight Through Dedicated Task Force
Fadillah said all proposed data centre developments are subject to comprehensive technical evaluations under the Data Centre Task Force (DCTF), which includes multiple government ministries and agencies.
The approval framework is designed to ensure that rapid expansion in the sector does not strain existing water and electricity supply systems or disrupt other users.
Water and Power Planning Safeguards
Under the current framework:
State water operators assess water availability before project approval
SPAN coordinates water supply assessments before submission to the DCTF
Electricity supply evaluations consider grid capacity and system reliability
Projects must demonstrate they will not affect domestic, commercial, or industrial users
The government has also introduced specific guidelines covering water supply requirements for data centres across planning, application, and operational stages.
Balancing Growth and Infrastructure Capacity
Authorities emphasised that while Malaysia continues to attract data centre investments, approvals are carefully managed to ensure infrastructure sustainability.
All proposed projects must pass technical assessments before being granted permission to proceed, ensuring alignment with national resource planning priorities.
Key Takeaways
Malaysia’s data centres use about 54% of approved electricity capacity (1,102 MW of 2,050 MW).
Water usage stands at 51.4% of approved demand (28.68 MLD of 55.83 MLD).
The figures indicate significant unused approved capacity in both utilities.
All data centre projects must go through the Data Centre Task Force (DCTF) for approval.
SPAN and state water operators oversee water supply assessments for projects.
Electricity approvals are based on grid capacity and system reliability considerations.
The government aims to balance rapid data centre growth with long-term infrastructure sustainability.
Yao Mu Realty, based in Kuala Lumpur, Malaysia, specializes in industrial real estate for factories and land, delivering professional and efficient solutions.
Posted by Yao Mu Realty Sdn Bhd on 25 Jun 26
Malaysia