As data centers expand globally to meet the demand for digital services, their establishment in Malaysia comes with notable challenges and drawbacks. While they support technological growth, these facilities pose significant environmental, economic, and societal risks. Below are the key reasons data centers could be detrimental to Malaysia, supported by statistics and insights:
1. High Energy Consumption and Carbon Emissions
- Energy Demand: Data centers are energy-intensive, consuming about 1% of the world’s total energy. In Malaysia, the National Energy Policy is already strained, with peak demand growing annually.
- Carbon Footprint: A single data center can emit as much CO₂ as 50,000 homes annually due to cooling systems and servers running 24/7. Malaysia’s reliance on fossil fuels (over 70% of electricity generated from coal and gas) compounds this environmental burden.
- Malaysia’s Pledge: Under its 2021 Climate Change Commitment, Malaysia aims for net-zero carbon by 2050. The rapid growth of energy-intensive data centers threatens to derail these goals.
2. Water Usage for Cooling
- Excessive Water Consumption: Data centers require vast amounts of water for cooling. On average, a medium-sized facility uses 1.8 million liters of water daily, equivalent to the daily water needs of 20,000 households.
- Impact on Local Communities: In regions already experiencing water scarcity, such as Selangor, the operation of data centers could worsen access to clean water for residents.
3. Strain on Infrastructure and Resources
- Land Use: Data centers require large parcels of land. In high-demand urban areas, this drives up land prices, making housing less affordable for Malaysians.
- Electricity Distribution: Malaysia’s infrastructure must allocate more resources to support data centers, potentially leading to power shortages for households and small businesses.
4. Limited Job Creation
- Minimal Employment Opportunities: Despite significant capital investment, data centers create relatively few jobs. For instance, a data center supporting 10 MW of capacity may employ fewer than 100 people.
- Mismatch with Local Workforce: High-skilled jobs in data centers often require specialized expertise in IT and engineering, which may lead to foreign talent dominating the sector, leaving minimal benefits for the local workforce.
5. Potential Environmental Hazards
- E-Waste: Data centers contribute to the growing problem of electronic waste. Malaysia already faces a 15% annual increase in e-waste, and improper disposal can lead to soil and water contamination.
- Heat Emissions: Excessive heat from large-scale facilities can alter local microclimates, impacting agricultural output and residential living conditions in surrounding areas.
6. Security and Sovereignty Concerns
- Data Localization Risks: Foreign-owned data centers often operate with little oversight, raising concerns about Malaysia’s ability to control sensitive data.
- Cybersecurity Threats: Concentrating vast amounts of data in one location creates attractive targets for hackers, increasing the risk of cyberattacks on Malaysian businesses and government agencies.
Statistics Highlighting the Challenges
- Energy Cost Growth: In Malaysia, the energy sector sees a 3-5% annual increase in electricity costs, which data centers will exacerbate.
- Land Scarcity: Kuala Lumpur and Johor face land shortages, with prices increasing by 10% annually in prime areas.
- Carbon Emissions: Malaysia emitted 250 million metric tons of CO₂ in 2022, with industrial energy use accounting for 45% of this figure.
Recommendations for Mitigating Risks
- Transition to Renewable Energy: Encourage data centers to use solar or wind energy instead of coal-based electricity.
- Water Recycling Systems: Mandate closed-loop cooling systems to minimize water waste.
- Tax Incentives for Green Practices: Provide tax benefits for facilities that adopt carbon-neutral operations.
- Promote Local Talent: Upskill Malaysians to take on specialized data center roles and reduce reliance on foreign talent.
- Enforce E-Waste Management: Strengthen regulations on the disposal and recycling of electronic waste.
