APDCA Energy sustainability white paper.pdf

flintglobalapac 67 views 20 slides Oct 22, 2025
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About This Presentation

APDCA has published a white paper offering a regional perspective on best practices and policy frameworks to enhance the energy sustainability of data centres across Asia-Pacific.


Slide Content

[Date]


[Document title]
[Document subtitle]
Elly Towns
[COMPANY NAME]

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The digital engine-room: Unlocking APAC’s economic and
digital potential through data centres

Contents
About the APDCA 02

Executive Summary 03

Best practices in data centres’ energy sustainability in Asia-Pacific 04

Policy approaches for enhancing the energy sustainability of data centres 10

Conclusion 19














About the APDCA
The APDCA brings together leading commercial data centre operators in Asia-Pacific to shape policy pathways
and drive informed discussion about the systems and infrastructure needed to build a secure and sustainable
digital future.
Our members share the collective pursuit of strengthening modern, diversified, and resilient economies built on
data, innovation and ideas, through the development of a competitive market of future-proofed facilities and
services.
The members of the APDCA represent leading global data centre operators, including AirTrunk, Digital Realty,
Equinix, Global Switch, NTT Global Data Centers, Princeton Digital Group, ST Telemedia Global Data Centres
(STT GDC), Vantage Data Centers, STACK Infrastructure and EdgeConneX.

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Executive Summary
Balancing energy sustainability with the surging
demand for digital infrastructure is one of Asia-
Pacific’s (APAC) defining challenges. Regional
demand for data centres – fuelled by cloud
adoption, digital services, and artificial intelligence
(AI) – is projected to grow at nearly 20% through
2028. These facilities are already powering life-
changing innovations: enabling telemedicine and
digital health, expanding access to education,
raising industrial productivity, and strengthening
disaster readiness.
But this transformation comes with a pressing
challenge: how to manage soaring digital demand
while safeguarding energy sustainability. The
International Energy Agency (IEA) predicted that
Southeast Asia’s data centre electricity use would
nearly double by 2030 compared to 2024, a trend
broadly reflective of the wider APAC region. AI
compounds this challenge: training a single model
such as GPT-4 would require around 30 megawatts
of power. Building and operating data centres in a
tropical climate with high temperatures and
humidity in APAC further limits the effectiveness of
energy efficiency measures prevalent in more
temperate regions.
Contrary to some public debate, data centres
currently account for approximately 1% of global
electricity consumption, and their annual
consumption is roughly equivalent to half that of
household IT appliances such as phones and TVs.
It is vital to be clear about where data centres sit in
this larger picture of total global electricity
consumption growth, especially given the critical
role they play in supporting digital and AI
transformation. However, their highly visible role in
local energy systems has sparked genuine
community concerns. These concerns must be
taken seriously. Transparent engagement, paired
with clear evidence and practical solutions, can
build the social licence needed for sustainable
growth.
The Asia-Pacific Data Centre Association (APDCA)
firmly believes that digital transformation and
energy sustainability are not competing goals – they
can and must advance together. To make this
possible, APDCA proposes seven actionable policy
recommendations across three priority areas:
• Policies supporting energy sustainability
Supporting expanded access to reliable and cost-
effective low-carbon and renewable energy is key to
enhancing data centres’ energy sustainability.
According to a 2025 report by Ember, a third of
Southeast Asia’s data centres could be powered by
solar and wind, without relying on battery storage,
by 2030. Fulfilling this vision will require supportive
policies that accelerate the push to increase the
availability of clean and renewable energy, improve
the grid infrastructure and regional grid
connectivity, and offer targeted policy incentives for
renewable energy use by data centres.
• Clear and consultative approach to
developing energy efficiency standards
Clear energy efficiency standards are critical to
guiding and incentivising data centre operators’
adoption of energy-efficient tools. Inter-government
coordination, shared voluntary targets, and the use
of internationally-recognised standards will be
crucial for avoiding regulatory fragmentation that
hampers the growth of digital infrastructure badly
needed to support governments’ digital
transformation and AI ambitions. APDCA is
advancing this agenda through the Sustainable
Digital Infrastructure Accord (SDIA), which unites
operators around shared voluntary targets and a
common baseline for sustainable approaches to
data centre construction and maintenance across
APAC. Beyond energy, the SDIA also addresses
water stewardship and circularity, ensuring a
comprehensive approach to sustainability.
• Partnerships enabling energy innovation
Governments and industry should collaborate to
promote partnerships to accelerate R&D and
training on data centre energy efficiency. Technical
knowledge and training on enhancing energy
efficiency in data centres will help position APAC as
an innovation hub for future-focused industries.
The opportunity is clear: with the right policy
frameworks, Asia-Pacific governments can ensure
that digital transformation advances hand in hand
with net zero ambitions. Achieving this will require
governments, industry, and communities to work
together – acknowledging concerns, building trust,
and strengthening the social licence to operate,
while driving broader progress in energy
sustainability.

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This report offers a preliminary roadmap. It
highlights best practices to maximise energy
efficiency and expand access to clean and
renewable energy across the data centre life-cycle,
while setting out actionable policy
recommendations to ensure digital and AI-driven
growth is delivered sustainably. APDCA looks
forward to working with policymakers and
stakeholders across the region to turn this vision
into reality.
Best practices in data centres’ energy
sustainability in Asia-Pacific
Across APAC, data centre operators are deploying
innovative solutions to ensure the rising demand for
digital services can be met sustainably. Most
importantly, operators are rapidly shifting towards
the procurement and deployment of renewable
energy. By exploring the shift towards more
integrated, enterprise-level renewable energy
strategies – such as regionally coordinated
procurement and emissions tracking – operators
are enabling scalable, consistent decarbonisation
across diverse APAC markets.
Beyond that, operators are also innovating to
maximise energy efficiency. Increasingly, AI plays a
role in driving energy efficiency at data centres,
from AI use to identify the optimal location for data
centre installations to AI-enabled monitoring and
predictive analytics to adjust cooling or power
distribution.
This section spotlights practical strategies for
increasing data centre energy sustainability at each
stage of their construction and maintenance: from
the planning, design, construction, operations, to
monitoring processes. It further highlights best
practices in promoting research & development in
data centre energy innovation.

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Planning
Procurement and deployment of renewable
energy
Data centre operators have committed to
progressively increase the use of renewable energy
in their operations, typically as part of their climate
goals. All APDCA members have set climate goals
that cover the use of renewable energy for their
operations, including:
Various APDCA members have committed to
renewable energy use, including:
• AirTrunk and Digital Realty have
committed to 100% renewable energy
matching – purchasing or generating
enough renewable energy to match
the amount of energy consumed by
their operations.
• EdgeConnex has pledged to
developing and operating a data
centre platform powered by 100%
renewable energy by 2030.
• By 2030, Equinix aims to achieve
100% clean and renewable energy
coverage across its global portfolios,
and Global Switch commits to using
100% renewable energy at all data
centre sites.
• STACK has achieved 100% renewable
energy coverage of electricity use
across its global data centre portfolio
since 2021.
Renewable energy use is also key to achieving
continued progress towards other APDCA
members’ net zero commitments, including:
• Vantage aims to achieve net zero
Scope 1 and 2 carbon emissions by
2030, and net zero across the value
chain by 2040 in line with The Climate
Pledge.
• Princeton Digital Group (PDG) has
committed to achieving 100% carbon-
free energy on an annual basis by 2026,
and progressively reaching 75% to
100% carbon-free energy on an hourly
basis by 2036.
• NTT Global Data Centers aims to
achieve net zero across Scope 1 and 2
emissions by 2030, and across Scope
1–3 by 2040.
• STT GDC commits to achieve carbon
neutrality by 2030.
Data centre operators are primarily using renewable
energy sources in three ways: renewable energy
procurement from third parties, off-site renewable
energy generation, and on-site generation. To
effectively address the challenges with data centres’
energy consumption, there will be an increasing
reliance on utility-scale, grid-interconnected clean
and renewable energy assets. Among the various
renewable energy procurement models, signing
power purchase agreements (PPAs) (see further in
next section) with renewable energy providers is
particularly contributing to data centres’ adoption of
renewable energy, thereby accelerating the
region’s energy transition.
Powering data centres with
renewable energy sources
Examples across the region demonstrate the
promise of scaling renewable energy use in data
centres through procuring renewable energy.
• In 2024, PDG procured 57% of energy
consumption from renewable sources
across India, Indonesia, China, and
Malaysia. In India, PDG has a 25 year
solar energy PPA and is piloting a project
with Flexidao to achieve time-matched
carbon-free energy consumption. It has
entered into a biomass energy contract
with PT Cikarang Listrindo for its data
centre in Greater Jakarta. In Malaysia,
PDG is actively exploring renewable
energy partnerships through the
Corporate Green Power Programme
(CRESS).
• AirTrunk has signed multiple renewable
energy sourcing contracts in Australia,
Hong Kong, and Malaysia. In Malaysia, it
is procuring renewable energy from ib
vogt, a renewable energy developer,
through the first virtual PPA achieved
under Malaysia’s Corporate Green
Power Programme (CGPP), an initiative
from Malaysia’s Energy Commission
seeking to enable businesses to sign

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virtual PPAs and engage in renewable
energy projects in Malaysia.
• In 2024, renewable energy accounted for
78.5% of the electricity consumption
across STT GDC’s global portfolio, which
includes key markets such as India and
Singapore. In India, STT GDC partnered
with several of the country’s leading
renewable energy providers to develop
new solar and wind farms and achieved
60% consumption from renewable
energy sources. This green energy is
delivered to its India data centres
through long-term PPAs, ensuring a
stable and sustainable energy supply. In
Singapore where renewable energy
supply is limited, STT GDC deploys solar
photovoltaic systems at its sites where
feasible.

Optimising site selection
Site selection is a critical component in ensuring
data centre energy sustainability. Typically, data
centre developers select sites based on factors
such as availability of free cooling, power reliability,
proximity to population centres (to access a skilled
workforce), resilience to climate change or natural
disasters, options for renewable energy, and taxes,
incentives, and regulations.
Several APAC governments have aimed to support
the location of data centres to strategically chosen
sites, which can lead to more efficient energy use.
For example, data centres located near renewable
energy sources, such as wind or solar farms, can
benefit from lower transmission losses and the
availability of cheaper renewable energy. Where this
is feasible, proximity to renewable energy sources
also allows data centres to deploy local renewable
energy sources, usually resulting in lower
operational costs that will in turn promote greater
energy efficiency. At the same time, to meet the
economy’s demands for digital infrastructure,
operators must also build in response to where
there is customer demand. Locations away from
metropolitan areas are most suitable for low-latency
use cases, such as AI training.
Japan: METI subsidies
supporting data centre location
near renewable energy sources
Japan offers incentives for the location of data
centres near carbon-neutral energy hubs, such
as offshore wind farms and nuclear plants.
Through subsidy programmes by the Ministry of
Economy, Trade, and Industry (METI), the
government is pushing for locating data centres
in places like Hokkaido, Japan’s northernmost
island that boasts abundant renewable energy
resources, and Kyushu, which is similarly
recognised for its renewable energy sources.

Design
Efficient cooling
Data centres generate large output of heat – high
temperatures can cause IT equipment to overheat,
causing breakdowns and costly downtime. Data
centres therefore require efficient cooling strategies
to maintain the IT infrastructure at an ideal
temperature and ensure optimal performance. As
the region transitions to support large-scale AI
workloads that generate immense heats, high-
density, AI-ready cooling strategies are increasingly
crucial for energy optimisation.
Common cooling methods include:
• Air cooling systems: which use air
conditioning, fans, and vents to circulate
ambient air, expelling the heat generated by
the computing equipment;
• Liquid cooling solutions: which replaces air
with a fluid-based method to, absorb heat
away from IT equipment; key types of liquid
cooling include liquid-to-chip cooling
(directly cools components with fluids) and
immersion cooling (submerges IT
infrastructure components in dielectric
fluids that absorb heat);
• Evaporative cooling: which draws outside
air in, cooling it before directing it to IT
equipment, with efficient heat absorption
via water evaporation;
• Free cooling: which uses cooler outdoor air
or water for heat removal; and
• Hybrid approaches: which combine
multiple cooling technologies.

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By embedding innovative energy-efficient cooling
techniques in the design phase, data centre
operators can enhance energy efficiency of their
facilities.
The region’s distinct climatic
challenges have driven innovation
aimed at promoting efficient cooling –
from advanced air cooling, liquid
cooling, to immersion cooling.
• Digital Realty’s high-density co-location
solution can support up to 150 kW per
rack in air cooling. It is also investing in
shifting traditional air cooling to
advanced liquid cooling down the chip
level, with one of its customers projecting
a 30% improvement in energy efficiency
by switching to liquid cooling.
• Global Switch introduced direct-to-chip
liquid cooling technology for its data
centres in Hong Kong. By removing heat
more efficiently than air-based systems,
liquid cooling reduces carbon emission.
• Immersion cooling specialist, Firmus,
launched an “AI Factory” initiative in STT
GDC’s data centres in Singapore. By
deploying immersion-cooled AI systems
at scale, STT GDC is achieving a lower
PUE.

Design for circularity
In line with circular economy principles – which
centre on eliminating waste and pollution,
circulating products and materials, and regenerating
nature – data centres can embed a circular economy
perspective in their design. In cooler climates in
APAC, data centres can repurpose waste heat to
support heating systems. Beyond heat reuse,
innovative approaches such as IT equipment
lifecycle management or e-waste circularity can
help data centre operators and their supply chain
partners reduce energy waste. For instance, Equinix
minimises environmental impact and recaptures
value from its assets through the Responsible
Electronics Disposal (RED) programme. This
initiative gives servers that leave Equinix’s business
a second useful life through refurbishment and
remarketing, contributing to reducing electronic
waste and conserving energy, as manufacturing
new servers require significant energy and raw
materials.
Circular thinking can be applied to
data centre design in APAC, but it will
need to accommodate for the
discrepancy in heating demands
between warmer and cooler temperatures.
In Japan, the White Data Center project in
Hokkaido and supported by Japan’s New
Energy and Industrial Technology Development
Organization (NEDO) uses its waste heat to run
an eel farm. The project experiments with using
waste heat produced by the servers during
winter for various agricultural options, such as
vegetable cultivation and fish and seafood
farming in greenhouses.

Construction
Use of energy-efficient materials
The supply chains of data centres can play a crucial
role in improving sustainability through the use of
energy-efficient construction materials. By
collaborating with suppliers committed to sourcing
sustainable components, data centre operators can
significantly reduce their overall energy
consumption throughout the data centre lifecycle.
This can include selecting materials with low
embodied carbon, such as high recycled content
steel, which minimises greenhouse gas emission.
Additionally, a modular approach to construction –
using pre-fabricated, scalable units that can be
easily assembled, modified, and reconfigured as
needed – allows for flexibility and scalability,
eliminates the need for overprovisioning, and
reduces energy waste.
Johor: a testbed for innovative
modular construction
In modular construction, waste can be reduced
compared to on-site data centre, due to the
vertical integration between the designers of the
data centre architecture, the procurement
teams who obtain the components, and the
assembly teams that put everything together in
the factory.
Modular construction is gaining momentum in
Johor. For example, in a recent ultra-large
modular data centre project in Johor –
contracted by CMIC Construction – its

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modularised building incorporates the concepts
of green energy saving and sustainable
development throughout the construction
process.

Operations
Hardware and software optimisation
Both hardware and software optimisation
techniques can play a critical role in maximising
energy efficiency in data centres. Impactful
hardware optimisation strategies include upgrading
to more energy-efficient hardware such as hard
drives and servers (e.g., using virtualisation
techniques or consolidating multiple physical
servers into virtual machines, which eliminates idle
resources and lowers overall energy consumption).
Meanwhile, software optimisation strategies such as
reviewing and optimising code algorithms and
database queries to minimise redundant operations,
as well as leveraging cloud-native principles that
promote resource scalability are effective ways to
lower energy consumption.
IMDA: encouraging server and
software optimisation
The IMDA's Green Data Centre Roadmap set a
target for only energy-efficient compute/IT
infrastructure to be used in all data centres in
Singapore over the next 10 years.
To achieve this goal, it encourages end-users to
improve the utilisation of their server
deployments and apply carbon-efficient
software design.

Monitoring
AI-enabled energy use assessment
In the past, traditional monitoring approaches
focused only on facility-wide PUE metrics, failing to
monitor energy consumption at the rack and device
level in data centres. AI is driving improvements in
data centres’ energy efficiency by allowing
operators to thoroughly and precisely assess each
facility’s energy consumption pattern in real time.
This is helping to identify energy inefficiencies and
waste points, improving overall energy performance.
AI-enabled workload
management
AI can help operators achieve substantial
energy savings without compromising
performance – from helping analyse operational
data to identify energy-intensive processes and
areas where optimisation is possible, to
dynamically allocating resources based on
computing demands to minimise energy waste.
• In Singapore, STT GDC piloted an AI-
based autonomous control system for
optimising cooling (Phaidra). Building
on legacy control systems, the AI
systems analyse vast amounts of
sensor trends in real-time to maximise
energy efficiency and cooling
performance. As the AI model is fed
more operational data, energy savings
are expected to rise from a baseline of
10% to as high as 30%.
• Equinix uses an AI-driven approach in
Hong Kong to optimise energy
management at select sites, resulting in
a 5% reduction in energy consumption,
saving around 200MWh per site
annually.
• Digital Realty developed an energy
efficiency AI platform, Apollo AI, to
improve PUE and drive energy
efficiency improvements across its
portfolio. Apollo AI uses machine
learning to provide a comprehensive
dashboard that identifies optimisation
opportunities at each facility, prioritising
them based on potential megawatt-hour
savings.

Research & Development
(R&D)
Data centres are benefitting from innovations that
have resulted in more low carbon energy use. R&D
– leveraging both private and public sector
investment – is key to innovation in improving the
energy-efficiency of data centres. Data centre

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operators are working with research institutions and
universities on cutting-edge approaches to data
centre construction and design. This has the
potential to turn APAC countries into hubs of
innovation around data centres and sustainability,
generating rapidly growing businesses and high
paying jobs.
Research programmes for data
centre energy innovation
• Equinix partners with the National
University of Singapore to set up a Co-
Innovation Facility (CIF) that will test
and develop innovative solutions
focused on low-carbon energy, high-
efficiency cooling, circularity, and
energy-efficiency optimisation for data
centres.
• PDG has established a Centre of
Excellence (CoE) at its Malaysia data
centre to showcase and test emerging
solutions aimed at improving
operational efficiency and reducing
environmental impact. The CoE serves
as a dynamic hub for both
demonstration and training, with latest
technologies from PDG’s partners
refreshed every six months.

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Policy approaches for enhancing the energy
sustainability of data centres
Data centre operators are continuing to innovate to
drive further improvements in making data centres
sustainable in their use of energy efficiency. But
with energy consumption associated with digital
infrastructure projected to increase, there is much
more that operators, policy-makers, and other
stakeholders can do to drive further improvement
and develop policy approaches that support a
sustainable approach to data centre buildout.






Ensuring that APAC countries can support digital
and AI innovation, while meeting their net zero
ambitions, will require sustained policymaker focus
and well-designed policy approaches. In this
report, APDCA offers seven strategic
recommendations for enhancing the energy
sustainability of data centres.

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Policies supporting energy
sustainability
1. Accelerate push to increase the
availability of clean and renewable
energy
Data centres operators’ efforts to support APAC
governments in their pursuit of digital transformation
and sustainability goals will depend in part on
continued progress in expanding the availability of
cost-effective clean and renewable energy.
As the Cushman & Wakefield 2025 Global Data
Center Market Comparison reveals, the majority of
APAC markets significantly fall behind competitors
in EMEA and the Americas in the availability of
renewable energy. Among the global data centre
markets ranked by the percentage of renewable
energy in their total energy mix in the Cushman &
Wakefield report, Auckland is the only APAC market
in the top ten. Investment in diversifying the energy
matrix, a supportive regulatory environment, and
access to natural renewable energy sources are key
to leading in renewable energy options in top EMEA
and Americas markets (e.g., Reykjavik and Sao
Paulo) as well as Aukland. At the same time, the
Ember research shows that with investments in
solar and wind capacity and modernisation of grid
infrastructure, solar and wind could meet up to 30%
of data centres’ electricity demand in ASEAN
countries by 2030.
Recognising the critical role of renewable energy in
attracting global data centre investment, several
APAC governments are taking decisive steps to
enhance its availability. By fostering an enabling
policy environment focused on renewable energy
reliability and affordability, these governments are
unlocking economic value from sustainable data
centre development and positioning their markets
for long-term success.
Japan’s Seventh Strategic Energy Plan
aims for a 40 – 50% renewable energy
share in the electricity mix by 2040. This
commitment is supported by regional initiatives to
drive investment in the generation and
transmission of clean and renewable electricity.
In Hokkaido, Japan, public and private sector
investments in wind, hydropower, solar, and
biomass in Hokkaido are expected to increase.
Additionally, the Hokkaido Governor and Sapporo
Mayor have requested the central government
support to strengthen Hokkaido’s renewable
energy sector, including support for the
investment needed to upgrade the local
electricity grid and shorter grid construction
timelines.
With a clear signal of government support for
renewable energy use, Hokkaido is further
attracting investments for data centres. Multiple
operators have announced data centre
developments utilising renewable energy in
Ishikari, Hokkaido, while Softbank unveiled a 300
MW data centre development in Tomakomai,
Hokkaido.
Policy certainty is essential for fostering investor
trust. By committing to multi-year frameworks that
offer stable signals on government support for
renewable energy use, Singapore has seen
significant corporate investment in renewable
energy that led to its record-high share of
renewables in its power generation mix in May 2025.
For instance, the Singapore Green Plan 2030
provides a clear roadmap for sustainability,
including a specific target to increase solar energy
deployment to at least 2 gigawatt-peak (GWp) by
2030.
2. Build robust interconnected and
modernised grid infrastructure
Expanding renewable energy capacity will not be
possible if the grid infrastructure is not improved
in parallel. Ongoing constraints on the transmission
infrastructure – such as grid bottlenecks, delays in
grid interconnection, and insufficient grid access for
renewable energy developers – impede timely
renewable energy deployment.
An IEA report in 2023 found that at least 3,000 GW
of renewable power projects globally were waiting
in grid connection queues – equivalent to five times
the amount of solar PV and wind capacity added in
2022. This underlines the need for grid
infrastructure to evolve to manage fluctuating
demand and diverse energy sources, especially as
data centre operators increase flexibility in their
location choices.
Accelerating the buildout of a robust and flexible
grid is key to unlocking renewable energy
deployment at-scale, particularly in Southeast Asia.
The IEA projects that Southeast Asia will need 1.7
million km of new grid infrastructure from 2021 to
2030, with 6% for transmission lines and 94% for
distribution lines.

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Coherent grid development policies are key to
expand, modernise and interconnect grids across
APAC. While many APAC governments have set out
their grid development priorities, Ember’s research
found that transmission grid expansion within
ASEAN needs to roughly double beyond what is
currently planned to deliver national clean energy
and climate targets that aligns with the above IEA
pathway by 2030. At the same time, ensuring long-
term financing mechanisms for grid upgrades, new
infrastructure, and innovation is critical.
Recognising the imbalance between
renewable energy supply and demand
across its islands, the Indonesia
government is developing a "supergrid" to
connect renewable energy sources, aiming to
improve system reliability and increase the
renewable energy mix (82% by 2060). For
example, the key project of Sumatra-Java
interconnection will require a $4.28 billion
investment to transmit clean energy sources,
such as geothermal and hydro power, from
Sumatra to Java.
To finance this grid expansion and strengthening,
Indonesia utilises a blend of public and private
financing. As highlighted in the Electricity Supply
Business Plan (2025-2034) by PLN, Indonesia’s
state utility, smart grid modernisation will be
funded through state budget allocations, loans
from international financial institutions, and
private sector investments.
Furthermore, there is an opportunity to support
region-wide initiative to interconnect the grid
infrastructures. The ASEAN Power Grid (APG), first
proposed in 1997 with a vision of an ASEAN
renewable energy power grid, is enabling member
states to import renewable energy from their
Southeast Asian neighbours.
By strengthening the business case for the APG’s
expedited realisation and offering to match energy
use with renewable supply across Southeast Asia,
data centres are critical to the execution of the APG.
Collectively prioritising such projects of regional
importance is crucial for maximising renewable
energy connectivity across APAC.
3. Offer policy incentives for renewable
energy use by data centres
As shown in the best practices above, data centre
operators can generate renewable energy on-site
and off-site. By stepping up targeted policy
support, governments can help accelerate the
uptake of cost-effective renewable energy use in
data centres. Experience shows that financial
support schemes and tax incentives and
expedited permitting can be effective in helping
increase the adoption of renewable energy, while
delivering multiples of return on the original
investment.
For instance, federal and state-level governments in
Australia have introduced a range of schemes to
promote renewable energy adoption, such as solar
rebates and financing options from the Clean
Energy Finance Corporation (CEFC), a government-
owned “green bank”. As highlighted in a CBRE
report, this government support has spurred
investment in renewable energy, leading to strong
market growth and providing investors with a
potential internal rate of return (IRR) ranging from
5% to 18% for solar farms, wind farms, and battery
storage systems. Thoughtful policy design is also
required to ensure that data centre operators can
effectively access these incentives, such as by
addressing common barriers from co-funding limits
to eligibility restrictions and administrative timelines.
In Australia, the Victorian Energy
Upgrades program provides incentives
for businesses to undertake energy
efficiency activities, including the use of
renewable energy sources. Equinix, for instance,
claimed Victorian Energy Efficiency Certificates
(VEECs) under the program to fund the
deployment of a 1MW rooftop solar system at its
ME1 IBX data centre in Melbourne.
In Singapore, data centre operators can tap on
government support schemes such as the
Economic Development Board’s (EDB)
Investment Allowance for Emissions Reduction
(IA(ER)) and Enhanced Resource Efficiency Grant
for Emissions (REG(E)). IA(ER) grants tax
exemptions on capital expenditure incurred for
energy-efficient or green data centre projects,
while REG(E) offers co-funding support
corresponding to the level of emissions reduction.
Lengthy permit granting procedures could inhibit
the deployment of renewable energy projects at the
scale needed to achieve energy targets.
Streamlining permitting processes for renewable
energy projects is crucial to ensure a stable
investment framework that fosters competitiveness

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The digital engine-room: Unlocking APAC’s economic and
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in APAC, especially as other regions have made
efforts to tackle this barrier.
As part of the REPowerEU Package, in
May 2024, the European Commission
introduced an
updated Recommendation and guidance on
speeding up permit-granting procedures for
renewable energy projects. This targeted
measure signals the Commission’s commitment
to support EU member states in improving
permitting rules for renewable energy projects.
4. Expand access to renewable energy
through supporting Power Purchase
Agreements (PPAs)
Thanks to a growing corporate PPA (i.e., signing
long-term contracts with energy suppliers to
purchase renewable energy) market in APAC,
operators are enhancing data centres’ energy
sustainability by procuring renewable energy.
As seen in the best practices above, through PPAs,
data centres can not only source renewable energy
effectively directly from energy producers but also
contribute to the broader regional transition towards
clean renewable energy. Meanwhile, several APAC
jurisdictions are constrained to procuring power
solely from the traditional utility providers with
limited flexibility on where to source electricity.











By enabling varied, cost-effective renewable
energy procurement options, such as virtual
PPAs, governments can also help improve data
centres’ access to and affordability of solar and
wind. A virtual PPA – a contract between a customer
and a renewable energy project developer – allows
companies to source renewable energy from
remote locations or even across national borders. It
differs from a physical PPA that requires the
physical delivery of electricity. For example, in
Southeast Asia, virtual PPAs are already available in
the Philippines, Singapore, Vietnam, Malaysia, and
Thailand. By opting for virtual PPAs, data centres
are contributing to the expansion of new renewable
energy initiatives, without the need for tangible
infrastructure or direct participation in the energy
market.
The infographic below offers a high-level mapping
of the readiness of PPA frameworks across key
APAC markets, highlighting the overall availability,
accessibility, and affordability of renewable energy
procurement.

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The digital engine-room: Unlocking APAC’s economic and
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Source: Environmental Resources Management;
KPMG; research on public sources

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The digital engine-room: Unlocking APAC’s economic and
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Continued policy support is needed to strengthen
the corporate PPA market and empower data centre
operators to directly source renewable energy.
Fluctuations or inconsistencies in policies
regarding the adoption of PPAs risk hindering
further growth. As highlighted in a 2025 report by
Primus Partners, an Indian consulting firm,
inconsistent state policies on PPA renegotiations
have deterred long-term investments in renewable
energy sources in India.
Recent progress in Japan and Vietnam provides
examples of policy frameworks which can promote
the domestic corporate PPA markets.
In Japan, the revised Basic Energy Plan,
updated Global Warming
Countermeasures Plan, and GX 2040
Vision send a clear policy signal that renewable
PPAs are encouraged to achieve the
government’s renewable energy targets,
supporting the continued growth of the corporate
PPA market.
In Vietnam, the Decree 57/2025/ND-CP issued in
March 2025 sets out regulations for transactions
between renewable energy power generation
units and large electricity users. By increasing
clarity around eligibility, pricing and payment
mechanisms, this will incentivise investment in
renewable energy projects.
Collaborative and consultative
approach to energy efficiency
standards
5. Work with stakeholders on ensuring
energy efficiency standards take
account of on-the-ground realities
APAC governments can further advance their
sustainability goals by fostering collaborative
initiatives that promote energy efficiency within local
data centres.
Singapore’s BCA-IMDA Green Mark for
Data Centres (GMDC) is a certification
scheme that recognises data centre
operators that have deployed green
data centre best practices and demonstrated
superior sustainability and environmental
performance. It comprises a rating system that
assesses data centres’ performance in areas
including energy efficiency. The GMDC was
jointly developed by the IMDA and BCA with
industry input.
Designing energy efficiency standards should also
draw on holistic engagement with academics, civil
society, and other relevant local stakeholders. This
is important in ensuring that standards take account
of the needs and concerns of different groups in
society. In this way, governments and digital
infrastructure operators can work together to build
public trust and address public resistance to data
centre development due to fears of the amounts of
energy consumption. There is potential for the data
centre industry to engage more fully with local
stakeholders to ensure that there is continued
support for data centre buildout, which helps
underpin economically and societally beneficial
digital innovation.
APDCA recently published a report
assessing the economic impact of
Malaysia’s data centre sector to the local
communities. It looks to continue engagement
with regional stakeholders on the development of
effective energy-efficient goals.
Moreover, such standards should be developed
with sufficient flexibility to take account of various
technical consideration. Adopting energy-efficiency
techniques, including the best practices outlined
above, is an iterative process and will require
investment and time. For example, during the
transition from air-based cooling to liquid cooling in
existing data centres handling both traditional cloud
density and AI density, there may be temporary
challenges that could stall efficiency gains.
Considering the strong customer requirements and
existing cost-saving benefits driving efficiency, it is
important to approach the potential for additional
energy efficiency standards thoughtfully to ensure
they provide meaningful value.
APDCA and its members are committed to working
with governments across the region to drive
improvements in energy efficiency that are both
ambitious and credible, taking account of realities
on the ground. APDCA is driving forward technical
work on a Sustainable Digital Infrastructure Accord
(SDIA), which will develop and iterate shared
voluntary targets and commitments, including on
energy efficiency. APDCA will be looking to engage

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governments and the wider industry on this process
in the coming months.
6. Promote regulatory alignment and
interoperability on data centre energy
efficiency guidelines
The data centre sector is operating in an
increasingly complex environment, with fast-
evolving policy and regulatory expectations
reshaping how sustainability and compliance are
approached across the region.
Data centre operators already face a complex matrix
of regulatory requirements on energy use in the
region. At the APAC level alone, China has a
Minimum Energy Performance Standard (MEPS) for
new data centres, Australia requires all data centre
facilities to achieve a National Australian Built
Environment Rating System (NABERS) Energy for
Data Centres infrastructure rating, while a number
of other APAC jurisdictions have implemented or
are considering separate requirements.
As the APAC region diverges in terms of climactic
and economic conditions, some differentiation in
energy efficiency rules for data centres is
unavoidable. However, governments should
consider how to mitigate against deepening
fragmentation of regulatory standards to avoid
creating unnecessary costs and complexity that
slows investment.
Promoting regulatory interoperability requires,
firstly, stronger co-ordination between
governments. The ASEAN-Japan Digital Work Plan
2025, which outlines initiatives for Japan and
ASEAN to cooperate on digital infrastructure (which
indirectly covers data centres), serves as an
example.
Additionally, establishing shared voluntary
targets that reflect the diverse climactic and
environmental conditions across APAC can help
promote and advance sustainability in the sector.
The EU Climate Neutral Data Center Pact, a self-
regulatory initiative with goals including 100%
renewable energy use and PUE targets, provides a
promising model for APAC to build on. In this
context, APDCA members are launching a
proactive, industry-led initiative, Sustainable Digital
Infrastructure Accord (SDIA), which lays out
ambitious but credible voluntary targets and
commitments regarding energy use. The SDIA’s
goal is to promote and advance sustainability in the
sector by establishing shared voluntary targets that
reflect the diverse climactic and environmental
conditions across APAC.
Ultimately, national energy standards are most
effective when they are harmonised with
internationally-recognised standards, such as
the ISO 14001 for Environmental Management
Systems (EMS), ISO 50001 for Energy Management
(EM), and LEED (Leadership in Energy and
Environmental Design; a widely used green building
rating system globally that provides a framework for
efficient green buildings).
By providing harmonised terms and definitions as
well as metrics to monitor and communicate energy
consumption, such standards have led to more
prudent energy use and increased energy efficiency
at data centres. For instance, data centre operators
have advocated for the use or certification of ISO
standards:
Global Switch strives to provide an ISO
14001 certified Environmental
Management System and an ISO 50001
certified Energy Management System at
each of its data centres.
AirTrunk aims to maintain ISO 14001 and ISO
45001 certifications across 100% of its
operational data centres.
Partnerships enabling energy
innovation
7. Promote public-private partnerships to
accelerate R&D and training on data
centre energy efficiency
Government and the private sector have a critical
role to play in promoting R&D, to ensure that data
centre operators have access to the technical
knowledge needed to enhancing energy efficiency
in data centres. There are already important
examples of R&D driving data-centre energy
innovations:
The project on “Next Generation Digital
Infrastructure Construction” in Japan,
funded by the New Energy Industrial
Technology Development Organization
(NEDO) (Japan’s largest public R&D
management organisation) seeks to improve the

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The digital engine-room: Unlocking APAC’s economic and
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energy efficiency of data centres through
photonics-electronics convergence technology.
By working with other regional governments,
industry, and international organisations, APAC
governments can also create a conducive regional
R&D environment, such as by supporting training
programmes on data-centre energy efficiency:
The Training Programme, jointly offered
by Singapore and the IEA, aims to equip
regional stakeholders with knowledge
and tools to support the development of
a more interconnected and resilient regional
power grid.
In a competitive global landscape, early investments
in R&D can provide APAC governments with a
leading edge in attracting an ecosystem of
innovation in data centre sustainability. The
deployment of advanced cooling technologies and
techniques and energy efficient hardware drives the
development of a network of suppliers, specialising
in innovative forms of technology or equipment,
generating high-value jobs of the future. Microsoft,
for example, has partnered with Univers, a
Singapore-based software development firm, to
explore energy optimisation measures across its
data centres.
A strategic focus on R&D around data centre energy
efficiency will help APAC countries to position
themselves as innovation hubs for future-focused
industries.

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Conclusion
Achieving a sustainable digital transformation is
essential for building a better future for communities
across Asia-Pacific. This report aims to support a
positive and practical conversation about how the
industry, government, and other stakeholders can
drive innovation that enhances the energy
sustainability of digital infrastructure.
The APDCA and its members will continue to put
sustainability at the heart of their product
development and their engagement with
stakeholders around the region. The Sustainable
Digital Infrastructure Accord (SDIA) will be a critical
component of efforts to establish a shared baseline
and common understanding around data centres
and sustainability. It will serve as a cross-market
coordination mechanism to align voluntary targets,
support engagement, and enhance sector
transparency. More details will follow on this in the
coming months. The APDCA and its members look
forward to contributing constructively to the
development of policy frameworks that ensure
digital transformation and the energy transition go
hand in hand.

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