APAC data centres strain power grids as demand surges: BMI

New facilities face tougher access to power.

Asia-Pacific’s (APAC) data centre expansion is putting increasing pressure on power grids, prompting governments to tighten connection rules, introduce higher tariffs, and restrict new projects as artificial intelligence (AI) and cloud workloads drive electricity demand.

Thailand is amongst the markets facing the sharpest near-term pressure, with data centre capacity forecast to more than double to 550 megawatts (MW) in 2026 from 242 MW in 2025.

BMI Country Risk & Industry Analysis expects the country’s electricity consumption to grow by an average 2.9% annually over the next decade, whilst supply constraints are expected to peak this year.

The Thai government suspended construction of 49 data centres in September, with new industry regulations expected within a month.

A new tariff category approved in July also requires data centres to pay roughly $0.15 (THB5) to $0.18 (THB6) per kilowatt-hour (kWh) and provide grid-use bonds before new infrastructure is built to serve them.

Malaysia is also tightening requirements as data centres become a larger source of electricity demand.

Data centres reportedly accounted for a record 9.3% of the country’s total electricity consumption in the second week of August, compared with a 7% annual average.

“In Malaysia, data centre operators are now required to demonstrate their own sources of power and water before grid connection is approved,” BMI said.

BMI expects supply pressure in Thailand and Malaysia to ease in 2027 as additional generation capacity comes online.

However, it cautions that pressure could persist as hyperscalers increasingly build their own facilities, which are excluded from its data centre forecasts.

Australia has taken a different approach, requiring the next generation of large-scale data centres to bring their own clean, firmed energy, operate flexibly, and connect efficiently.

“Additional measures include demand flexibility during periods of grid stress, as well as onsite backup generation and storage,” BMI added.

In Vietnam, coal generation rose 9.8% year on year in the first half of 2026 amidst strong electricity demand and liquefied natural gas price increases, whilst the government signalled that it could revise its power plan to add coal-fired capacity.

The tightening measures reflect a broader challenge for APAC power systems as data centre and AI investment grows faster than grid infrastructure can be expanded.

BMI expects policymakers, particularly in emerging markets, to increasingly turn to dispatchable generation such as gas and coal to address short-term supply constraints.

(US$1 = THB33.52)