Malaysia Poised to Become ASEAN's Largest Sustainable Data Center Hub, Predicts CIMB

CIMB Securities forecasts that Malaysia is on track to emerge as ASEAN's premier sustainable data center hub amid breakthroughs in clean energy and green infrastructure.

As of end-September 2025, Tenaga Nasional Bhd (TNB) powers 29 data center projects with a total maximum demand of 3.8 GW, up significantly from prior quarters.

Surge in Data Center Capacity

TNB has now secured 49 electricity agreements totaling 7.1 GW by Q3 2025, reflecting explosive historical growth from 6.4 GW in Q1.

Rising GPU densities are shifting bottlenecks from power supply to cooling systems, with next-gen chips demanding far higher power per rack.

Pioneering Sustainable Cooling Innovations

Nvidia's upcoming Rubin Ultra and Feynman chips are projected to consume 600-1,000 kW per rack by 2028, necessitating liquid cooling adoption.

Malaysia recalibrated regulations, including Johor's ban on Tier 1-2 centers, to prioritize high-impact green AI projects.

Operators like ZData, Bridge Data Centers, and AirTrunk partner with local utilities to repurpose wastewater for cooling, enhancing water resilience.

Microsoft deploys closed-loop chip cooling in Johor Bahru, while Nvidia enables warm water operations up to 45°C.

These advancements mitigate global gridlocks, positioning Malaysia competitively in the AI arms race with optimized costs and regulations.

Historically robust expansion and future sustainability focus promise economic boosts, job creation, and accelerated energy transition.

By integrating waste heat recovery and reclaimed resources, Malaysia eyes water-positive data centers, inspiring regional leadership.