Microsoft announces decision to invest USD2.2 billion in Malaysia and we all cheer.
Some even said we won Indonesia and Singapore...but who exactly is having the last laugh??
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According to studies conducted by the Gorisco Group, the city-state of Singapore is one of the world’s most desirable locations for a data center. Out of Southeast Asia’s entire data capacity, Singapore accounts for 60 percent of this capacity.
However, in 2019, the Singapore government put brakes on new data centers due to the environmental impact of operating them. Strict environmental regulations have meant Singapore will lose out to other regional players in the context of being a data center hub.
Johor’s proximity to Singapore has given it a boost to becoming a data center hub. Johor has 13 data centre facilities across more than 1.65 million square feet of land mass. Major data centre players like Nvidia, AirTrunk, GDS International, YTL Power as well as Princeton Digital Group have set up operations there, and tech giant Microsoft has reportedly purchased land in Kulai to open a data centre.
Tengku Zafrul Abdul Aziz, minister of investment, trade and industry, announced that “our target for Malaysia's data center industry is to achieve a revenue of close to $800 million by 2025” from the current $400 million.
What is less publicly mentioned (for obvious reasons) is that these massive server farms have a very significant impact on the environment.
“In Malaysia, our electricity and water tariffs are pretty low in comparison with many countries. So that’s why data centres like it here, ” says an industry observer.
"Is it right to bring in such investments that use up so much of our resources while not creating sufficient jobs....the data centres are largely software and artificial intelligence (AI) driven " he pointed out.
However, the Malaysia Investment and Development Authority disputes the observation data centres do not create enough jobs citing the need for skilled personnel to operate them.
Others have cited these environmental concerns:
1. Energy Consumption & Pollution- data centers require massive amounts of electricity to power servers and networks. High levels of carbon dioxide emissions are emitted. The cooling systems used require large amounts of energy to keep temperatures down, leading to even more emissions.
2. Water Usage & Contamination- large amounts of water are required to cool the high temperatures generated by servers. Local communities are deprived of a valuable resource which can be used for agriculture and drinking. If not managed properly, this cooling water contains heavy metals and can contaminate the local environment.
3. Heat Emission & Global Warming- data centers emit waste heat that must be managed with coolers or released into the environment. The latter impacts the local ecosystem and contributes to global warming.
4. Natural Habitat Destruction-large areas of land need to be cleared to build data centers. Biodiversity, including native flora and fauna in the area is affected. Soil erosion results, and the runoff can end up in streams and rivers.
5. Waste and disposal issues- large amounts of e-waste which contain chemicals such as mercury and lead are produced by data centers. Unless there is proper control, these can contaminate the area’s soil and water.
(Sources: Gorisco, MSPL, NST, MIDA)
Malaysia Wins Indonesia and SG in Data Centres, ...but who is really having last laugh??
May 10 2024, 10:58 AM, updated 2y ago
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