Johor Targets Additional 5 GW Solar Energy by 2031 to Meet Data Centre Demand

Malaysia's Johor state is planning to add approximately 5 gigawatts of solar generation capacity over the next four to five years, as the state government moves to address surging electricity demand driven by the rapid expansion of its data centre sector. The initiative is intended to reinforce grid capacity and ensure that industrial power needs do not compromise public utility supply.

Lee Ting Han, chairman of the state's Investment, Trade, Consumer Affairs and Human Resources Committee, said the strategic move would help the national grid balance industrial and public supply requirements. The plan follows concerns raised in a report by BMI, a Fitch Solutions company, which estimated that Johor's data centres would require about 30 terawatt-hours of electricity annually by 2031 — accounting for 18 per cent of Peninsular Malaysia's total electricity supply, up from six per cent this year.

According to Lee, the Johor government has approved 65 data centre projects based on land plots. Of these, 21 data centres have commenced operations and are expected to consume nearly 1.1 GW of electricity, while projects still under construction or in the planning stage will require an additional 4 GW to 5 GW. To ensure that large-scale electricity consumption does not disrupt public utility supply, the state has established the Johor State Data Centre Development Coordination Committee (JPPPDNJ), chaired by Johor Housing and Local Government Committee chairman Datuk Mohd Jafni Md Shukor, with Lee serving as deputy chairman. All proposed data centre developments must obtain approval from the committee before applying to local authorities for planning permission, and the committee also evaluates power usage effectiveness (PUE) to ensure efficient electricity use in compliance with regulations.

Lee said the state government has taken note of the BMI report and that capacity expansion plans are being implemented comprehensively at both state and federal levels. The Energy Commission, under the Ministry of Energy Transition and Water Transformation, has called for new tenders to increase power capacity by 8 GW across Peninsular Malaysia, with a significant portion of the additional capacity expected to be channelled to Johor. At the state level, Johor is intensifying large-scale solar projects to diversify electricity supply sources in the Kota Tinggi, Mersing and Segamat areas. The initiative comprises solar projects totalling 4 GW in Kota Tinggi and Mersing, expected to start in phases from mid-2029, as well as a 1 GW solar project in Segamat. Overall, these projects are expected to raise Johor's solar generation capacity by about an additional 5 GW by 2030 or 2031 for channelling to data centres and large-scale industries.

Lee also welcomed the Federal Government's policy allowing operators of large-scale data centres to explore alternative solutions, including off-grid solutions to generate their own electricity, subject to stipulated regulations. He noted that developing new generation capacity takes considerable time, and that efforts to increase electricity generation through solar projects, off-grid solutions and new tenders issued by the Energy Commission are being actively pursued by both the Johor government and the Federal Government. "We are confident that this careful planning will ensure an adequate electricity supply to support the growth of the data centre industry and other industrial developments in Johor," he said.