PETALING JAYA: The mushrooming data centres in Malaysia will be the main driver for electricity demand growth, benefiting the country’s sole electricity provider, Tenaga Nasional Bhd (TNB). In fact, TNB’s electricity sales already hit a record in the first quarter of 2024 at 31,899 gigawatt hours, driven by two new data centres that have a combined installed capacity of about 600 megawatts (MW). The strong sales was achieved despite the first quarter being seasonally the weakest quarter in the year.
Kenanga Research, which upgraded its call on TNB to “outperform” and raised the target price by 16%, said TNB guided for electricity demand growth of 2.5% to 3% in 2024. “We expect the same growth rate over Regulatory Period 4 (RP4), versus 1.
8% during RP3, backed by a strong pipeline of data centre projects. “TNB guided for nine data centre projects with a total energy demand of 700MW to be completed in 2024. “So far, two with 535MW energy demand were already commissioned in March 2024, namely Yondr Data Centre and Princeton Digital Group Data Centre, both in Sedenak Tech Park, Johor.
“Also, in January 2024, TNB signed an Electricity Supply Agreement (ESA) each with Microsoft for its data centre scheduled for commissioning by June 2025, and Vantage Data Centres for its data centre scheduled for commissioning by December 2025. “The two data centres with a combined energy demand of 484MW are located in Cyberjaya.” Given the positive outlook ahead, Kenanga Resear.
