Johor Emerges as a Data Center Powerhouse: A New Era for Digital Infrastructure

In recent years, Johor has positioned itself as a new favorite for large-scale data centers, leveraging the spillover effects from Singapore, a regional hub for data storage and processing. The state, which is the third largest economy in Malaysia, has seen remarkable growth in the data center sector, nearly surpassing its own progress over the last decade in just two or three years. This trend is expected to continue, with Johor on track to potentially outpace Singapore in the coming years.

Seizing the Opportunity Post-Pandemic

Historically, Singapore’s data center capacity has been unmatched due to its mature infrastructure. However, the COVID-19 pandemic led to a temporary suppression of construction, creating a backlog of demand. As operations return to normal, the limited resources of land, water, and electricity in Singapore have forced the local government to pause further expansion in the data center arena.

Capitalising on this opportunity, the Johor state government has actively attracted investments, making it an appealing location for high-computing power data centers. These centers are strategically positioned to serve major clients, including global tech giants such as ByteDance and Microsoft, setting them apart from their counterparts in Kuala Lumpur, Selangor, and Cyberjaya, which primarily focus on local markets.

The Rise of Sedenak Tech Park

With the swift expansion of data centers, the once dormant Sedenak Tech Park in Kulai has been revitalised. This 1,400-acre site, previously an oil palm plantation, is now emerging as a new data center hub in Johor, joining the ranks of Nusajaya Tech Park in Iskandar Puteri.

As of October this year, Johor is witnessing the development of 11 large-scale data center projects, with six located in the Senai Technology Park. Additionally, over 30 projects are currently competing for approval to join the state’s development track. By the end of next year, the estimated total power consumption is expected to reach between 2,770 to 3,000 megawatts—more than twice the capacity of Singapore.

Addressing Water Supply Challenges

Despite the abundance of power supply, Johor faces challenges related to water availability, particularly in suburban areas. State Executive Councillor Lee Ting Han acknowledged the high water consumption required by data centers, leading to pressures on local infrastructure. To address these challenges, the Johor government, through its wholly-owned subsidiary Johor Special Water Corporation (JSW), is exploring innovative solutions such as processing wastewater for industrial use, extracting groundwater, and desalinating seawater.

Future Infrastructure and Connectivity

While Johor ranks as the eighth largest data center market in the Asia Pacific, its infrastructure—particularly regarding optical cable connectivity—still lags behind Singapore. Currently, data transits through land optical cables like the Johor-Singapore Causeway, necessitating improved connectivity to enable Johor to become a regional data hub.

Wang Rongyao, Executive Director of Open DC Data Center, highlighted the area’s potential as a regional connection hub, noting that an upgrade to Johor’s status as a data exchange center could enhance data routing efficiency and significantly reduce costs.

Regulatory Needs and Future Planning

To ensure sustainable growth in the data center sector, it is essential for regulatory frameworks to be established promptly. As the influx of data centers increases resource consumption, timely regulations will be necessary to manage operations effectively. With Malaysia’s neutral political stance, abundant resources, and robust infrastructure, the nation has significant advantages that can be harnessed to support the growth of data centers.

As Johor continues to develop its digital infrastructure, the state is poised to become a treasure trove for data centers, driving innovation and economic growth in the era of big data.

For more information, read the original article from 8TV News here.