PETALING JAYA: The actual water consumption by data centres (DCs) in Johor still remains materially below committed levels, says BIMB Research.
In a report, the research house noted Johor currently has around 15 DCs in operation, consuming 18 million litres per day (mld) versus about 45 mld originally requested, implying only around 40% utilisation of booked capacity.
Nevertheless, based on DC operators’ forward water demand submissions, BIMB Research said immediate potable water availability is insufficient to meet projected requirements.
This necessitates a material expansion of raw-water infrastructure over the remainder of the decade.
Hence, Johor requires a significant new raw-water supply by 2030, but new river sources face execution challenges, the research house added.
BIMB Research noted that Ranhill SAJ, a subsidiary of Ranhill Utilities Bhd
, estimated that Johor will require roughly 1,000 mld of new potable water supply by 2030.
“This requirement is incremental to projects already under construction, namely Layang 2 Phase 2 (160 mld) and the Semangar Package Plant (50 mld), scheduled for completion in 2026 to 2027.”
In addition, potential new raw water sources such as Sungai Sedili Besar and Sungai Endau are located far from the main industrial and DC clusters in southern Johor, implying higher distribution costs and longer execution timelines.
While a comprehensive Sungai Sedili raw water and distribution project could ultimately supply up to 2,000 mld at an indicative cost of around RM4bil, it said progress has been slow due to delays in consultant appointments, feasibility and environmental studies, and ultimately state and government approvals.
Against this backdrop, channel checks suggest Ranhill SAJ is increasingly inclined towards a modular off-river storage approach as an interim solution.
Each off-river storage unit, with a capacity of around 300 mld and an estimated cost below RM1bil, offers faster approvals, lower upfront capital risk and a reduced likelihood of stranded assets.
This will mitigate the risk of domestic consumers bearing higher tariffs to recover large, underutilised water infrastructure investments during the still-gradual ramp-up in DC water demand, added BIMB Research.
