Data centres in Malaysia to pay 10%–15% more for electricity, analysts say

• The power-hungry facilities will be placed under a new “ultra-high voltage” category with average tariffs of about 60 sen per kilowatt-hour, according to the analysts who attended an investor briefing by Tenaga Nasional Bhd

KUALA LUMPUR (July 2): Data centres in Malaysia may see their electricity bills rise by up to 15% under the new power tariff structure, analysts said.

The power-hungry facilities will be placed under a new “ultra-high voltage” category with average tariffs of about 60 sen per kilowatt-hour, according to the analysts who attended an investor briefing by Tenaga Nasional Bhd (KL:TENAGA).

For a 100 megawatt facility, the revisions would mean an additional cost of up to RM63 million annually, according to Public Investment Bank’s estimates.

The Energy Commission announced a slew of changes that also includes monthly adjustment to electricity tariffs beginning July. The revisions are now shifting the burden to heavier consumers to be more efficient and manage their power usage, while providing slight savings to the typical homes.

The revisions also punish users with low load factors—those who consume more power during peak hours but use relatively less at other times. While data centres have high load factors due to round-the-clock operations, they would suffer higher peak and off-peak charges under the new structure.

More than two-thirds of the medium voltage commercial and industrial consumers would see some bill reductions, while the remaining ones may be impacted due to the inefficiency of system usage, according to MIDF Amanah Investment Bank.

“A good load factor” is generally within the range of 60% to 70%, and those below that range may potentially see 5% to 6% increases in monthly bills, the house noted.

However, heavy voltage users with low load factors may face higher effective tariffs at 58–70 sen per kilowatt-hour, and the higher tariffs may encourage the users to explore renewable energy options, Hong Leong Investment Bank said.

Does Malaysia have what it takes to become a Blue Zone, marked by health and longevity? Download a copy of EdgeProp’s Blueprint for Wellness to check out townships that are paving the path towards that.