PETALING JAYA: Malaysia expects to add about nine gigawatts (GW) of gas-fired power generation capacity as it phases out coal by 2044, as rapidly growing electricity demand, including from data centres, puts increasing pressure on the country’s power generation needs.
Data centres are now consuming about 9.28% of the country’s electricity, while keen interest is also being seen under the Corporate Renewable Energy Supply Scheme as large electricity users increasingly seek renewable energy supplies.
The Energy Commission (EC) said there is currently no cap on electricity consumption by data centres, with approvals instead determined by the amount of electricity that the power system is capable of supplying.
Economy Minister Akmal Nasrullah Mohd Nasir said that the government will not pursue further development of coal-fired power plants, with Malaysia’s last coal power plant expected to be retired by 2044.
“At the same time, in order to manage electricity, I think we expect about 9GW to be deployed or to be put into the system through our gas power plants,” he said yesterday at the Energy Regulatory Insights 2026 organised by the EC.
“The phase-out for coal power plants will be seen by 2044, which will see the country retiring its final coal power plant then,” he added.
Akmal Nasrullah said Malaysia’s challenge would increasingly extend beyond simply building additional generation capacity as electricity consumption continues to grow.
“But looking ahead, managing demand for energy will become as crucial as managing the energy supply,” he said.
The next five to 10 years would require continued discipline in upgrading the country’s electricity system, including both generation capacity and the infrastructure required to deliver that power.
“Malaysia must really remain disciplined enough to ensure our system needs to be continuously upgraded and that our power systems remain affordable, safe and sustainable.”
He also pointed to prevailing environmental conditions as another factor affecting the efficiency of energy use.
“The ongoing haze means there may be changes in terms of energy efficiency.”
Meanwhile, EC chief executive officer Siti Safinah Salleh said the country’s electricity system is presently experiencing peak demand of slightly above 21GW, with the current hot weather, including the haze, contributing to broadly higher consumption.
“We do expect that there will be an increase from last year, both from the consumption due to weather and also because of data centre demand,” Siti Safinah said at a press briefing yesterday.
She said electricity consumption by data centres had risen sharply from around 7% at mid-year to 9.28% of total consumption presently: partly due to the hot weather that’s driven by the El Nino phenomenon.
Siti Safinah said the increase in electricity demand was therefore not being driven by data centres alone, as weather-related consumption was also pushing up the system’s underlying load.
Demand is expected to rise further towards the end of the year as additional data centre capacity starts operations.
“There are a few data centres that are anticipated to come online or become operational somewhere in November,” she noted.
