- 2 months ago
AI and data centre growth are driving a new surge in electricity demand. Niaga AWANI speaks with experts on grid readiness, energy security, and sustainable digital expansion.
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00:18The AI boom is no longer just about a technology story, but it's a power story.
00:24As Malaysia attracts more AI investment, more data centres, electricity demand is getting higher, denser and more continuous than traditional
00:33loads.
00:35And as we can see, global discussion, including at the World Economic Forum, also warns that AI and hyperscale data
00:42could sharply increase the power consumption for this decade, putting pressures on grid, storage and even energy security.
00:50And for now, so the critical question is definitely we have to ask is Malaysia is not how fast Malaysia
00:57is adopting and how fast we are growing our digital economy, but whether our infrastructure is ready for it.
01:03And for this segment, we're going to speak to experts to examine the numbers, the risks and what happened next
01:09to make sure the AI is aligned with the national grid stability and sustainability.
01:14And for that, I welcome you.
01:16Our guest ready in the studio with us is Ko Shuan Zhang, the group CEO and co-founder of PlusXnergy.
01:23Honestly, thank you very much, Ko, for joining me.
01:25Definitely for 2026, we're still talking about more the boom of AI, data centres and a lot of power consumption
01:33in many ways.
01:34And global projections also suggest that data centres and electricity could nearly double by 2030, according to AI scenarios, with
01:42Malaysia rapidly attracting AI investments, a data centre.
01:47The main question, has our national load forecast has been revised specifically for AI-driven demands?
01:54What's your thought on this?
01:55Yeah, I would say definitely is something looks good that there's a lot of investment on data centres coming into
02:02Malaysia.
02:03And definitely the question is because as we understand for AI, the key things, there's a five layer of the
02:11structure and the key fundamental to build the AI up to the end user to use it, like the AI
02:17agent, what we are using today.
02:18Actually, the first thing first before the infrastructure is about the energy source.
02:22And that's the reason why we are seeing whether Malaysia is ready for that.
02:26And for Malaysia, I would say, if we want to build a data centre, it's quite important for them to
02:34look into power source and also the water source as well.
02:38Because energy source and also cooling is always very important.
02:41That's why if you look into the whole Malaysia, I would say right now, Peninsula definitely, right now in Johor
02:47and also in this Selangor, it's quite a good place for that.
02:51And if you look into the whole country infrastructure grid and on the energy side, right now Malaysia Peninsula, in
02:59terms of energy power generation, it's about 25 gigawatts.
03:03Yeah, it's about 25 gigawatts.
03:05Okay.
03:05Yeah.
03:06So that is good enough for the existing, like the base load and those are loads that demand on the
03:11population and also the economy growth from time being.
03:15So for data centre, recently, I would say the existing previously in the beginning of last year, actually is less
03:22than 1 gigawatts.
03:24And I would say right now it's almost like double up.
03:26It's double, correct.
03:27So I would say to move on, based on the news which they mentioned they are coming in to the
03:35country, those MOU signing and also those like Google and also like Microsoft who mentioned on this,
03:44it could step up to about the range, it's quite wide, it can be up to 4 gigawatts to 8
03:50gigawatts in the next 5 to 10 years range.
03:54Yeah.
03:55So based on that right now, the question is when our grid is only ready for 25, how do we
04:02literally able to catch up for the next potentially like 4, 5 gigawatts in the next 5 years?
04:10For example, if all this is coming, if let's say AI, data centre, this investment is not a bubble, it's
04:16something real.
04:17So I would say definitely it's not 100% ready because of most of this energy which is coming in,
04:26if we are going to build the energy supply based on the traditional energy, there are a few challenges here.
04:34First of all, there are not green energy.
04:35And today, most of those data centres who operate from overseas, they need to have a green energy.
04:41And secondly, those power plant, it could be really long.
04:46In order to build it, it could be about 4 to 5 years time.
04:49And data centre, we know the demand is huge, it's fast.
04:53So we need something which is able to catch up to speed as well.
04:56So based on this, I would say the country definitely right now on the national grid, ST and also TNB,
05:03really look into the proper planning based on this demand from existing grid and how to capture and also to
05:11fill out a gap from the clean energy based on this corporate renewable energy supply scheme, CREST, is also in
05:19place.
05:19So I would say all this on the grid on the national level in the country, I would say it's
05:26all in plan, it's all in plan.
05:29So that's why this is, I would say this data centre which is coming in, definitely it will be able
05:33to drive some foreign investment in.
05:36But the grid readiness is have to be based on stage by stage.
05:39And also renewable energy definitely is the answer.
05:42So like solar and storage and come with a policy like CREST in place is important.
05:48And definitely, I would say this has to grow a few things concurrently.
05:53So first of all, about how to plan on the energy side for those like Johor and also in the
05:59Selangor area for the existing data centre to come in or the existing power, demand, the load and supply side.
06:06Secondly, for those infra on the energy side, let's say on the data centre come in, in the probably 18,
06:1424 months, they need to up one data centre.
06:17So how soon is that local distribution in terms of energy readiness, it's important as well to plan for it.
06:24At the same time, it's about the midterm.
06:26At the same time, how can they offset whatever the CO2 emission which they emit by clean energy.
06:34And the clean energy plant has to build concurrently as well.
06:38So I would say definitely the existing.
06:41And besides that, one very important thing is our national grid has to literally moving towards to smart grid.
06:49So when the grid is smarter, which means we are able to capture more renewable energy.
06:55Yeah, so when we have more renewable energy, for example, like solar, it will be the main energy resources in
07:01the country.
07:02We need the grid to be more stabilised with energy storage, like battery storage as well.
07:07So smart grid, power generation from solar, energy storage, like BAS, which is a battery, this energy storage system in
07:19place.
07:20All this have to run concurrently on the grid upgrade, on the grid planning, on the infrastructure readiness.
07:26Yeah, so I would say right now, Malaysia, we are literally going through this.
07:29And so far, I would say, looks still in place.
07:34And definitely, this is the requirements for us to be in great readiness.
07:39And talking about data centres, investment, Google, Microsoft is coming.
07:44It's a very great investment.
07:45But now we have to think about, can this investment only have to build, but can we sustain with this
07:50investment?
07:50It's definitely very important.
07:51And what is quite interesting for me is for all the requirements that we need to be ready in all
07:57this development,
07:59for our, in reality, for in which part of our system that is not ready yet?
08:04Is it the generation, transmission, or distribution?
08:07Okay, for Malaysia, in terms of our transmission, distribution, definitely, I would say in Peninsula,
08:14it's one of the strongest in Southeast Asia.
08:17Yeah, I think this is something that we are quite proud of.
08:20But I would say right now, the immediate one definitely is on the generation part.
08:26Yeah, that's on the, because as I mentioned, it's only 25 gigawatt.
08:31And when you have another additional 4 gigawatt coming in, definitely, we need to supply more energy on that.
08:36And definitely, from time being, I would say it's important.
08:40Yeah, also, literally, it will become urgent.
08:43It will be on the grid infrastructure's improvement, especially on the grid stabilisation.
08:48Yeah, that is important.
08:49So that's why, if we look into the latest tariff change, at the 1st of July last year,
08:56we were able to find out, in terms of the tariff which they charge to the radyard on the home
09:03user,
09:04and also for the factory or commercial users who are at the low-voltage side,
09:08actually, the government, yeah, which we lower the kilowatt-hour charges in RM.
09:16But in order to upgrade the whole country, grid infrastructure, some have to pay for that.
09:20That's why we find out, in terms of the, like, those, like, maximum demand charges,
09:26which only happen for the medium voltage, those are heavy industry,
09:32which actually, the charges over there, also, like, almost, like, triple up.
09:37Yeah, so that is where the country is able to have fun,
09:40able to maintain or even upgrade the grid infrastructures step-by-step from there.
09:46So, definitely, someone has to pay for that.
09:49Definitely, the upgrade of infrastructure is important.
09:52But I will see right now, the immediate one definitely is mainly on the energy generation.
09:57And this is not just happening in Malaysia.
09:59If you look into the US state and also China, in terms of the competition in AI,
10:04yeah, people like Shenzhen Wang or Elon Musk, they did mention China is much ahead
10:09because their energy power infrastructure is much more ready compared with US.
10:14So, the same thing will be happening in Malaysia as well.
10:18And this definitely will create a lot of opportunity as well in the country.
10:21It's also, I also would like to pick up with what you mentioned earlier that you said that
10:25for us to be ready that this is the important elements that we need to take a look at
10:30for smart technology, smart grid, and also, and the storage.
10:34Storage is very, very important.
10:36Not only talking about, even for our phone, mobile phones, storage is also important.
10:39Now, we're talking about data center.
10:42And talking about, we know that many Malaysian Solar Plus BSS project currently provide
10:48around two until four hours of storage.
10:51But for 24-7 AI and hyperskilled data center operation, is that technically sufficient?
10:58How can we catch up?
11:01Okay.
11:01So, I would say right now, in terms of solar energy, definitely the cost of generation
11:06is quite competitive compared with the traditional energy from traditional power generation.
11:12But when you go for solar plus BSS, which is the energy storage, the cost will be higher.
11:18That's why right now, in terms of solar plus BSS to totally replace the traditional energy,
11:25the cost definitely is still higher.
11:26That's why right now, I would say the energy storage function, it will not dare to plus together
11:34with solar energy to totally replace the traditional energy.
11:38But it will play a role for a few things.
11:41First of all, as a grid stabilizer.
11:44For the places which you have a demand and a supply mismatching places, which you have
11:51able to have a storage there in this area to stabilize it, that's the first thing.
11:55On the grid level, if let's say we go for the factory level, so why it's only like two
12:04to four hours?
12:05It's because if we go for a longer hour, totally want to replace it, the cost will be very high.
12:09But if we go for two to four hours, like to stabilize for the peak period, for the hour in
12:15the country,
12:16in one day is possible.
12:19Or even though for factory, because right now for factory or for data centers, usually they
12:24will have these peak demand charges, which is from 2pm to 10pm.
12:29So when you have a battery there, able to lower down this peak demand period, which is like
12:35two to four hours, I would say is quite good enough to stabilize it.
12:39So that's why right now the battery has become a medium to neutralize, to stabilize on the
12:46demand side and also on the supply side.
12:48But from time being, it still can't go for a longer hour because the cost does matter.
12:54It's something we can't have a better ROI in terms of investment.
12:59In terms of investment.
13:01Yeah, correct.
13:01And very important for us to like sustain this investment beyond the investment timeline.
13:07And let's talk about PPA, power purchase.
13:11And definitely this is something that we know that large data centers in Malaysia is increasingly
13:15use corporate PPAs and even green power programs.
13:19And from this, when grid becomes, we can say becomes tight and could like long-term contracts
13:27also distorts pricing signals or indirectly affect tariff on different users.
13:33What's your thoughts on this and how can we manage?
13:35Okay.
13:36So right now, I would say in country, these grid chargers, the way of how ST and also on
13:44TNB side to structure it, I would say is quite sustainable.
13:48Because right now, all the fundamental is still back to the normal grid chargers from the
13:54ST as well as what electricity could.
13:57So for PPA, in terms of the discount, in terms of the clean energy, let's say how many
14:04percent cheaper compared with the traditional energy.
14:06If let's say this solar system or battery is at your premise, definitely the discount
14:11can go bigger.
14:13All right.
14:13Yeah.
14:13So actually, everything will still back to the grid.
14:17Yeah.
14:18I mean the open public tariff code, the tariff chargers.
14:22So, and for the one who like to purchase for clean energy, they will enjoy some certain
14:28discount.
14:29Yeah.
14:30It just depends on your solar is on the side or your solar is at the other side.
14:35If let's say like Crest, this program, your data center can be in Johor.
14:39But you can build a solar farm at Kedah.
14:42Yeah.
14:42So this under Crest program, because your land in Johor could be quite expensive.
14:46And the solar area at Kedah is much better.
14:49So I can have another solar farm there.
14:52And I just buy the power from Kedah to Johor for me to use.
14:56But throughout this progress, I need to pay a toll fee.
14:59Yeah.
15:00Which is a willing charge to pay to this grid operator.
15:04So definitely these charges have to pay them to maintain the whole infrastructures.
15:08So I would say all these structures, right, it's quite well structured that only for the
15:15user who want to purchase on clean energy, they have to pay for it.
15:18Or maybe they could have some saving on that.
15:20So it would not really affect those existing tariff code.
15:25Yeah.
15:26Especially for rakyat or for other small SME business owner.
15:30Yeah.
15:30So the way of how we structure it is quite well categorized.
15:35But the way of how we structure it is also have to make sure for the clean energy purchaser
15:40able to buy the energy in a cleaner and also a cheaper way.
15:44Yeah.
15:45And also we need to think about all the small players.
15:49What are some of the safeguard measurements that we can ensure for smallest users
15:53are not indirectly exposed to price distortion?
15:58Yeah.
15:58I would say right now they are all quite safe.
16:01Because if we look into the whole energy electricity tariff structure, for low voltage,
16:08actually right now if you look into the kilowatt hour charges compared with 1st of July
16:13before last year, actually right now has become lower.
16:16So the country actually will still need more clean energy, this demand.
16:20And also like more energy demand, more power have to generate.
16:24But you will see the whole infrastructures, maintenance costs, they are all mainly focused
16:29on heavy industry.
16:30Like middle voltage, these categories of energy consumer and also and above.
16:38So it could be middle voltage, high voltage or ultra high voltage.
16:42They are the ones who have to pay for the bill.
16:44So this is how the country, I would say, ring fence it.
16:48Yeah.
16:48And they are the ones who need the most clean energy as well.
16:52So when they pay for that, I would say it's a kind of the fair system and also the fair
16:57structures.
16:57And also, Ko, Malaysia is both for digital hub and also developing economy with growing industrial and household demand.
17:08How do we ensure that AI and data centre loads do not especially crowd out manufacturing SMEs or even public
17:17infrastructure energy needs?
17:18Yeah.
17:19I think this is one of a very important question because we don't understand definitely the investment for data centre
17:25coming in.
17:26I think it's good for the economy, especially on the construction side, on the energy side, but for long run
17:32in terms of job opportunity, it might not as big if compared with manufacturing because there centre, you don't need
17:39much people to operate it.
17:41So definitely, I would say, in terms of how to manage it, this is something which I strongly believe on
17:50our country side, in terms of government side, they know how to work on it.
17:54But in terms of the energy side, from our understanding as an energy industry player, for this SME or let's
18:04say for the mid-tier corporate who are running factory and business, it's always there.
18:08In terms of the energy supply is always there.
18:13That's why for data centre, in order to come in, they have to apply, which they have to apply for
18:19the new infra, they have to apply for this new supply.
18:24So this is how the grid operator, they try to ring fence it.
18:29And most of them, actually, they need to sign up CREST as well, which is to build solar energy battery
18:35system to offset, to increase those new power demand.
18:39So definitely, I would say, right now, that's why it's good that right now, this rush of a data centre
18:45coming into the country, in order to build it, is not too overwhelmed or super fast.
18:53Yeah, it's like literally like half gigawatt, then slowly go to one gigawatt, another 1.5 gigawatt from time to
19:01time.
19:02I think based on this speed, in terms of stabilise the grid readiness and do not affect those SME businesses,
19:10mouth and pop businesses, I think still there.
19:12It's very important for us to like growth, but also protect all these small stakeholders.
19:17And should energy intensive digital projects be evaluated based on economic value created per megawatt consume, actually?
19:25Yeah, I think definitely we should.
19:27Yeah, because it's also quite arguable when people talk about like data centre coming in, what kind of economic contribution
19:35it will bring as well.
19:37Yeah, that's why I would say that everything we have to come into a balancing point.
19:42Yeah, because like a factory, definitely, it could be getting more local businesses to export.
19:50Yeah, because this is something to grow for country economy, first thing.
19:54Yeah, because we are building bottom Malaysia and then we are selling out to the country.
19:57I think that's always there, we have to protect it.
19:59Secondly, for one factory, definitely we need to have labour or we need to have manpower in terms of white
20:05collar, book collar.
20:06So the job opportunity is always there.
20:08So I would say this definitely is the sector that the government that shouldn't miss out.
20:15And from what I'm seeing right now, it's still quite well protected from energy in terms of the distribution on
20:23that,
20:23because this always comes into a priority.
20:26So for data centre, it's always the special zone in terms of a great energy planning for that.
20:32So I would say right now, we still see some harmonise at this beginning stage and I hope this will
20:40be able to monitor and track well.
20:42Yeah, so it will always not affect those mom and pop pieces or the rest of other Malaysia brand or
20:50Malaysia company.
20:51All right, let's give it a situation where we are in a very constrained supply scenario.
20:57How should Malaysia prioritise or balance between, we can say, data centres, manufacturing and even public services?
21:05As you know that it's tough time.
21:08I would say definitely right now, if we look into the whole country economy, I agree.
21:18The tough time on the business side is crucial right now because we do understand in the different industry right
21:26now,
21:27in terms of like from China to Malaysia to like trade war, all these things.
21:32Actually, not everyone, they have a very good business.
21:34So I think in terms of lower down the energy bill is something quite helpful for those business owner.
21:41And right now, like the battery technology able to lower down their maximum demand in terms of the charges to
21:48the grid.
21:48But investment of battery right now can be less than five years, can be less than four years.
21:53It can be also share a lot of burden for those manufacturers in the country.
21:58Because I think manufacturers are always the engine to build the economy of the country.
22:02I think all this new technology and also investment on the energy side is so far, I would say, still
22:08able to share the burden for them.
22:10So because if you look into manufacturing, they always have three largest costs, which is main power cost, energy cost
22:16and also raw material.
22:18So as long as the energy side is able to manage well with different technology in terms of investment that
22:24lower down the bill, I think it's there.
22:26We have to make them stay competitive and the rest has to depend on each company, how competitive are them.
22:32However, if you look into the macro point of view in the whole country, we need infrastructure project to drive
22:38the whole country economy.
22:39It's always from those super mega skill project.
22:43So you will see construction company there, banker able to give loan and then we are able to get a
22:48developer and also the contractor there.
22:53And slowly you will see job opportunity.
22:55So the whole value chain, right, it's always start from those big infrastructure project.
22:59So I would say definitely in the past few years, Malaysia, we quite rare to have a super mega skill
23:08project.
23:09And right now, definitely we are able to see it's a good news that finally, I think since last year,
23:16those foreign investors coming in that we started to see a lot of this mega skill project started to drive
23:21the country economy.
23:23And this is how one of part of reason the Malaysia currency also get strengthened.
23:30Yeah, I think the strengthening with all this investment coming into Malaysia definitely play a big, big role.
23:35So I think this balancing definitely has to be there because when this mega skill project coming in, the value
23:41chain is all open up.
23:42Definitely you will see this value chain eventually.
23:44It will still go to those local businesses from mom and pop up to the local manufacturers.
23:49Yeah, because when this demand is there, the value chain is able to drive up and definitely everyone able to
23:57get this benefit from there.
24:00You said it yourself that sometimes the whole value chain is also starts with a mega big project.
24:07Yes.
24:07So should demand response capability be mandatory for large AI and data center facilities?
24:15Yeah, I think definitely, yes, we need it.
24:17Because when this coming in, it's also a kind of activator to activate the country, have more urgency, for example,
24:24to upgrade our grid infrastructures, to accelerate the energy transition for the country.
24:29And when we have all this, you have more business opportunity, you have more job opportunity, definitely you will be
24:36able to bring a lot of, I would say, this stimulation or let's say this impact to impact, to bring
24:45positive impact for the country economy.
24:46Because I would say, if we talk about the rugyard sentiment side today, I think people are quite proud that,
24:56okay, at least Malaysia is one of a country that has a lot of data center players invest in in
25:03this country.
25:04And definitely in the past one year, we also have been able to see there's a lot of data center
25:10related listed core, actually, in terms of their share price, in terms of their project business, able to bring a
25:16lot of different excitement in the economy.
25:19So, yeah, definitely, I would say, and also it's kind of push, to push for the engineering enhancement, because data
25:25center to build it is not that easy, have to be fast, precise, yeah, in terms of technology side.
25:31So, yeah, yeah, so I would say definitely the pro is more than cons.
25:36Right.
25:36You as a group and also the CEO managing a lot of development and you have to navigate all the
25:43challenges and create more opportunities for the whole ecosystem from people and also the great.
25:49And if you could advise from your experience and observation, and if you could advise policymaker directly, what is the
25:55single most urgent reform needed to align with digital growth and even energy readiness?
26:01To wrap up our conversation, please share with us.
26:02I would say definitely economy growth and energy readiness have to go concurrently, but do not forget the fundamental right
26:09now is always come from energy side.
26:11Okay.
26:12Yeah, so energy is pretty important.
26:14And the other one is the policymaker have to ensure those policy in the country in terms of those of
26:21fee and also on the economic side is able to work.
26:25So right now, definitely in terms of, I would say, the infrastructures on Crest is facing a challenge right now
26:32as because there's a willing charges.
26:36I would say right now, if you look into the country, there's one fact that we have to face, which
26:43is in terms of a Crest, the successful of the Crest under this policy, the project is quite few.
26:51There are some projects already get approval, but it just gets started very recently.
26:56It's mainly because of, in order to pay the willing charges, the willing charges right now, I would say, is
27:01still at the high side.
27:02Right. So as an off-taker, they don't really see much of benefit if they buy clean energy because in
27:09terms of a saving, it might not really there.
27:11That's the first thing.
27:13Secondly, right now, the global solar panel price or battery energy storage price has increased a lot since January because
27:19from China's side, they are going to remove the tax exemption at the 1st of April.
27:26And right now, in China government, actually, they are lower down the production for solar energy in the entire China.
27:33They say right now, globally, on the price of renewable energy also has increased.
27:37So when the investment costs increase, when the policy itself, we still have to pay quite a high, like, SAC
27:46charges or willing charges,
27:48we will see the green power purchaser in terms of their demand, it will reduce.
27:56Yeah.
27:56So I think this is one of the key things that the policymaker, or let's say as an industrial player,
28:03we all have to seriously look into this and see how do we need to adjust ourselves along the way
28:08to seal through the different...
28:10Not run, but we need to adjust and adapt, definitely.
28:12Yeah, we need to adjust and adapt based on time, from time to time.
28:15And that's a critical reminder, AI growth is not just a digital story, but it's a power story.
28:22Yes.
28:22And what you just shared with us throughout the whole conversation, readiness, transparency and great resilience will decide how far
28:30and how fast can Malaysia go.
28:31Thank you again so much for our guests.
28:34It's an honour to have you here to coach Juan Zan, the group's CEO and co-founder of Plus Xnergy.
28:39Again, I hope to see you soon and happy Chinese New Year and hope you can have a very good
28:45celebration after this.
28:46Thank you again.
28:46Yeah, thank you so much.
28:48And definitely all of our discussion here will be featured in astrovanic.com and across all social media platforms.
28:54And that's it from me.
28:55I'm Nina Rosman.
28:55See you next time.
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