What happened
Microsoft expands its data centre footprint across Southeast Asia, including a US$1.7 billion investment in Indonesia, to meet AI demand. This regional expansion, also involving Amazon, Google, Alibaba, and Tencent, drives a projected tripling of Southeast Asia's data centre capacity by 2030, fuelled by a tenfold increase in AI use. Microsoft's Jakarta facilities use closed-loop water cooling systems and adapt designs for higher-performance chips, with the company committing to raise Indonesia's renewable energy capacity by 200MW over a decade.
Why it matters
Data centre expansion will increase demand on Southeast Asia's power grids and water resources. Infrastructure architects and procurement teams must account for increased electricity demand; Indonesia's data centre power consumption could quadruple by 2030, with nearly 70% of its electricity from coal. Water supplies face increased demand, particularly in regions like Jakarta, which experiences groundwater extraction issues. This follows Singapore's 2019-2022 moratorium on new data centres due to energy and water concerns, shifting development to neighbouring countries.
