ASEAN Data Centers Could Run 30% on Renewables by 2030

By Francis Allan L. Angelo

Up to 30% of Southeast Asia’s booming data center industry could be powered by solar and wind by 2030, without relying on battery storage, according to a report released today, May 27, 2025, by the London-based think tank Ember.

As the global demand for data infrastructure surges—fueled by cloud computing, artificial intelligence (AI), and digital transformation—the Association of Southeast Asian Nations (ASEAN) is emerging as a critical player.

The Ember report, From AI to Emissions: Aligning ASEAN’s Digital Growth with Energy Transition Goals, highlights that Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Viet Nam are rapidly becoming global data center hubs, with 2.9 gigawatts (GW) of new capacity in development.

However, the growth is presenting a double-edged sword. While it promises digital economic expansion, it also threatens to derail regional climate goals. Ember’s analysis warns that if left unchecked, the rising electricity consumption of data centers—many of which still draw power from coal- and gas-dominated grids—could cause a spike in carbon emissions across the region.

SOARING POWER DEMAND

Malaysia is on track to become the region’s fastest-growing data center market, with electricity demand projected to increase from 9 terawatt-hours (TWh) in 2024 to 68 TWh in 2030—equivalent to 30% of the country’s national consumption and surpassing Singapore’s entire power use in 2023.

This growth could lead to a sevenfold rise in emissions, from 5.9 million tonnes of carbon dioxide equivalent (MtCO2e) in 2024 to 40 MtCO2e in 2030, making it the largest emitter among the six ASEAN nations.

The Philippines and Indonesia are not far behind. The Philippines is expected to witness a 14-fold increase in emissions, while Indonesia’s data center emissions are set to quadruple. Both countries remain heavily reliant on coal-fired power, compounding the environmental impact of digital growth.

“Data centre growth is straining power systems in ASEAN, where most electricity still comes from coal and gas,” said Pritesh Swamy, Head of Data Centre Research & Insights for Asia Pacific at Cushman & Wakefield. “Scaling up renewables and modernizing infrastructure through proactive investment and regional collaboration is key to ensuring sustainable growth and advancing the energy transition”.

CLEAN POWER POTENTIAL

Despite the bleak emissions outlook, the Ember report finds a hopeful path forward: approximately one-third of ASEAN’s projected data center electricity demand in 2030 could be met using solar and wind power already available on national grids—without the need for battery storage.

This is a significant finding, as high battery costs have often been cited as a barrier to clean energy adoption. But Ember’s analysis shows that in the short term, ASEAN can leapfrog this challenge by tapping into existing renewable resources.

“ASEAN’s booming data center industry risks derailing energy transition goals without urgent action,” said Shabrina Nadhila, Electricity Policy Analyst for Southeast Asia at Ember.

“Prioritizing solar and wind power, as well as energy efficiency, supported by strong policies, a national framework for data centers and collaboration, would help ensure data centers drive sustainable digital growth rather than deepen reliance on fossil fuels”.

THE EFFICIENCY IMPERATIVE

Energy efficiency is another key pillar of the clean growth strategy. According to the report, up to 39% of data center electricity consumption goes toward cooling systems—especially critical in ASEAN’s tropical climate.

Efficiency can be gained by optimizing airflow, raising cooling temperature thresholds, and investing in advanced technologies like immersion cooling, which can cut power use by up to 40%. Singapore has already incorporated such innovations into its national data center roadmap.

Moreover, software and hardware optimization can significantly reduce the energy intensity of AI training. New methods like DeepSeek are estimated to be 95% more efficient than conventional AI training models, signaling further opportunity for digital sustainability.

PROCUREMENT BARRIERS

While large global tech companies operating in the region—such as Amazon Web Services, Google, and Meta—often use Power Purchase Agreements (PPAs) to secure renewable energy, these mechanisms are not widely accessible to smaller data center operators.

This has led many to rely on unbundled Renewable Energy Certificates (RECs) or utility-offered green tariffs, both of which expose buyers to price volatility.

To broaden clean energy access, the report calls for greater availability of flexible procurement mechanisms, such as virtual PPAs and power wheeling—an approach that enables power generated in one location to be transmitted to another through shared grid infrastructure.

The lack of such frameworks is a major impediment to private investment in renewables. For instance, Indonesia, despite its growing data center footprint, has yet to implement a national power wheeling mechanism.

POLICY PUSH NEEDED

Governments across ASEAN are beginning to take steps to align the digital and energy transition agendas. Singapore, for example, has developed a Data Centre-Call for Application (DC-CFA) framework to selectively approve new data center projects based on energy efficiency and sustainability criteria.

Malaysia and the Philippines have introduced various sustainability incentives, but these often come after the industry’s initial expansion—leaving many existing facilities outside modern compliance requirements. Viet Nam plans to implement green data center standards by 2025.

Nadhila emphasized the need for proactive planning: “Governments and industry should work together to align data center expansion with the energy transition. National frameworks, stronger collaboration and better transparency are critical to ensuring that ASEAN’s digital growth also drives progress”.

INVESTMENT OUTLOOK

Meeting the region’s renewable energy needs for data centers will require substantial investment—estimated between $45 billion and $75 billion by 2030.

These funds would go toward scaling up wind and solar capacity across the five most energy-intensive data center markets: Malaysia, Indonesia, the Philippines, Singapore and Thailand.

The report concludes that ASEAN has a limited but pivotal window to align digital expansion with climate action. By integrating solar and wind energy, enhancing energy efficiency, and enacting supportive national policies, the region can lead the way in building a sustainable digital economy.