Hello Reader,
Two separate data centre developments happened without much fanfare in Singapore and Malaysia this week. But their repercussions will be significant and far-reaching.
Today, I want to talk about Singapore's plans to mandate PUE standards for existing data centres, and Malaysia's tightening approval process for new ones.
Singapore to mandate PUE standards for all DCs
The first happened at the launch of the Singtel Centre of Excellence for Applied AI. Singapore's Senior Minister of State Tan Kiat How was the guest of honour, and he spent part of his speech talking about the upcoming Digital Infrastructure Act (DIA). The senior minister said the (delayed) Act will be tabled in parliament later this year, and shared additional details that no media other than w.media has caught yet.
I wasn't there; initial plans to attend fell apart. However, the transcript I obtained spelt it out clearly: the DIA will seek to establish "baseline energy efficiency requirements" for both existing and new facilities in Singapore. This will come through the imposition of PUE requirements, though no specific figures were mentioned.
PUE (Power Usage Effectiveness) is a metric that measures how efficiently a data centre uses energy. It is derived by dividing the total incoming energy into a data centre by the energy delivered to IT equipment at the racks. The lower the PUE, the better.
While not without its flaws, PUE has been generally adopted as a simplistic way to measure data centre energy efficiency. For reference, the pilot DC-CFA specified a PUE of 1.3, while the DC-CFA2 mandated a lower 1.25.
Improving the PUE of an existing facility is no trivial task. I am aware of just one operational data centre in Singapore that upgraded its cooling systems without booting customers out first. Unfortunately, while the director of engineering reached out and was keen to show me the exceptional work by the team, senior leadership ultimately vetoed the plan.
I did some asking around, and it would appear that only China has mandated minimum energy efficiency levels on existing data centres to date. In France, existing facilities will have to achieve a set PUE level to qualify for a tax relief scheme, but that's a carrot, not a stick. So if it comes to pass, and there's no reason it shouldn't, Singapore will enter very rarified company.
The PUE requirements will be gradually phased in, and his words suggest it won't be an impossible mark, so don't panic yet. Still, applying such a policy retroactively to existing facilities sends an unmistakable signal that Singapore isn't merely playing lip service to more sustainability.
Here's what he said. Words in bold by me:
The proposed new legislation seeks to establish baseline energy efficiency requirements for all data centres – existing and new ones that will be built. We will start by imposing Power Usage Effectiveness (PUE) requirements on data centres.
MDDI and IMDA have been consulting industry stakeholders to ensure that the proposed requirements – while ambitious – are practicable and consistent with international benchmarks.
We want the DCs in Singapore to be more energy efficient and sustainable – not just for new DCs built in the coming years, but also existing DCs as they refresh their technologies and IT equipment over time to meet the DIA requirements.
By systematically raising the energy efficiency and sustainability of all our DCs, we can create more headroom to support the growing demands of Singapore’s digital economy, particularly with the push for AI adoption.
A more selective future
Across the causeway, Malaysian Prime Minister Anwar Ibrahim earlier this week dropped a bombshell when he revealed in Parliament that the country has limited approvals for new data centres that are not AI-related.
Malaysia has been steadily tightening approvals for new data centres over the last two years, forced to make tough choices in the face of skyrocketing resource demands. Clearly, it sees an opportunity with AI data centres and is expressing that selectiveness with a strong preference towards AI workloads. I personally don't see how data centres geared solely towards AI training are beneficial for Malaysia in the long run, but that's a topic for another day.
What he shared next was where things got interesting. While Anwar said existing electricity production is sufficient for short-term requirements, I found it curious that he also highlighted initiatives such as plans to transmit power from Sarawak and the ASEAN Energy Grid as ways to meet mid- to long-term energy needs.
Perhaps it shouldn't be surprising, though. From just 10MW and a single data centre in Johor in 2021, there are now hundreds of megawatts of operational capacity. And as a whole, Malaysia is set to surpass Singapore in data centre capacity by 2027 and the rest of APAC, excluding China, by 2030.
But what Anwar shared suggests that the country is scrambling to beef up its reserve margin, which is still considered adequate, but has declined substantially in recent years. Will Malaysia eventually tighten rules for data centres further, such as with the mooted Malaysia Sustainable Data Centre Framework? I wouldn't bet against it.
One last thing: I've been having sporadic issues with email deliverability to Office365 email addresses. Can you drop me a quick note if there have been weeks you haven't seen this newsletter? You can reach me by replying to this email.
Regards,
Paul Mah
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