PETRONAS could supply gas to Malaysia data centres for dedicated power generation
Malaysia is weighing a new way to meet rising energy demand from data centres as artificial intelligence investment accelerates. The approach could help PETRONAS lock in longer-term domestic buyers at market rates while reducing reliance on the national electricity grid.
Highlights
- PETRONAS could supply gas directly to data centres in Malaysia for power generation, tapping into the sector's substantial energy demand.
- The ministry said supplying gas to data centres could help develop Malaysia's domestic gas market and secure long-term customers at market rates.
- Tenaga Nasional Bhd currently supplies electricity to 36 data centres, with dozens more data centre projects planned in Malaysia.
This article was translated from the original. Read the original version by our correspondent here.
Proposal to supply gas to data centres
As reported by The Edge Malaysia, Investment, Trade and Industry Minister Datuk Seri Johari Abdul Ghani said Malaysia could explore supplying gas to data centres for dedicated power generation, rather than relying entirely on electricity from the national grid.He said the national oil and gas company, officially known as Petroliam Nasional Bhd, could benefit from data centres' substantial energy demand. If successful, PETRONAS could secure longer-term customers at market rates, instead of supplying subsidised energy to data centre operators.
Johari said the data centre boom presents an opportunity for Malaysia's gas industry to develop an additional domestic market. He delivered the keynote address at Bursa Malaysia's Sectoral Series: Powering the AI Era, Watt Next? event, as a wave of energy-intensive data centres continues to grow in Malaysia amid the global artificial intelligence boom.
Implications for Malaysia's energy sector
Johari said Malaysia could also combine gas with other energy sources, such as solar, to support data centre needs, rather than relying solely on existing electricity supplies. He noted that some of the country's gas resources could potentially be redirected to domestic power generation, subject to current export commitments and domestic energy needs.He said longer-term supply arrangements could give energy producers greater certainty about demand, while enabling data centre operators to secure the power they need to run their operations. Tenaga Nasional Bhd currently supplies electricity to 36 data centres, with dozens more projects in the pipeline.
Previously, we reported on the government's plan to introduce “user-pays” electricity tariffs for data centres and energy-intensive industries.
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