By Gigi Onag
October 30, 2026
The relentless surge of artificial intelligence and cloud computing workloads is pushing Asia’s digital infrastructure to its absolute limits, triggering a critical scramble for power that is reshaping how data centers are planned, built, and operated across the region. In a pair of separate announcements this week, major data center operators DayOne and Nxera revealed that they have signed strategic memorandums of understanding (MoUs) with Sembcorp Utilities. These landmark agreements are designed to secure reliable, long-term power supplies for their rapidly expanding facilities, highlighting the mounting pressures facing the industry as traditional energy grids struggle to keep pace.
The rapid expansion of data centers across the Asia-Pacific region is currently constrained by a severe power supply bottleneck. As national grids fall behind the unprecedented demand driven by next-generation computing workloads, industry analysts have predicted that data center power consumption across the region will skyrocket to over 1,000 terawatt-hours of electricity by the mid-2030s. This represents a staggering escalation from less than 200 terawatt-hours consumed today.
This energy deficit is particularly pronounced in key Southeast Asian markets, including Indonesia, Malaysia, and Thailand. In response to these acute grid constraints, regional governments are shifting away from open-door approval policies toward strict regulatory mandates. Today’s developers face rigorous oversight regarding energy intensity, water usage, and grid-sharing protocols, forcing a fundamental reassessment of how digital infrastructure is powered.
Hyperscalers and data center operators are increasingly moving away from total reliance on public electrical grids. Instead, they are aggressively exploring independent power plants, co-located energy generation facilities, and direct private renewable energy setups. To navigate these hurdles, forward-thinking data center developers are forging strategic alliances with major utility companies to build onsite or dedicated power solutions capable of sustaining multi-megawatt operations without destabilizing local communities.
Nxera Explores Renewable and Low-Carbon Energy in Singapore
At this week’s Singapore International Energy Week (SIEW) event, Nxera—the dedicated data center arm of telecommunications giant Singtel—announced a landmark collaboration with Sembcorp Industries. The partnership aims to supply Singapore-based data center operations with a steady stream of renewable and low-carbon energy, addressing the unique operational challenges of a highly dense urban market.
"AI is driving a step-change in the power needs of data centers, and in a land- and resource-constrained market like Singapore, how we source that power matters," said Bill Chang, CEO of Nxera and Singtel’s Digital InfraCo unit.
Operating within Singapore’s tight geographical boundaries presents distinct hurdles for digital infrastructure providers. To overcome these constraints, Nxera and Sembcorp will evaluate a wide array of innovative power solutions. These potential initiatives include low-carbon and hydrogen-based power generation, biomethane-based power generation, the integration of advanced photovoltaics into vertical building structures, and the cross-border import of renewable energy. Among the most ambitious cross-border proposals is the potential utilization of clean energy sourced from the massive 2.2GWp floating solar project at the Linggiu Reservoir in neighboring Johor, Malaysia.
Nxera emphasized that these forward-looking initiatives will be instrumental in reducing its corporate carbon footprint as its operational footprint expands to meet enterprise demand. By diversifying its energy portfolio, the company aims to insulate its clients from future grid instabilities and regulatory shocks.
"Working with Sembcorp gives us more options to power our growth sustainably and responsibly," Chang added. "Strengthening our energy resilience will be critical to underpinning Nxera’s long-term development in Singapore while supporting Singapore’s digital ambitions."
Integrating Power Planning into Data Center Development
While Nxera focuses on securing clean power for Singapore’s constrained urban environment, rival operator DayOne is taking a proactive, foundational approach across its regional footprint. DayOne is collaborating with Sembcorp under its ambitious "Bring Your Own Power" initiative. This framework integrates power planning into the very earliest stages of data center development, ensuring that suitable energy solutions are identified, evaluated, and secured long before ground is broken on a new campus.
This integrated approach is designed to de-risk projects, successfully navigate increasingly constrained regional power markets, and provide enterprise customers with the absolute confidence required to scale their digital infrastructure deployments.
The two companies have formally agreed to evaluate advanced solutions encompassing on-site power infrastructure and generation, the direct supply of renewable energy, and comprehensive operations and maintenance services. Jamie Khoo, CEO of DayOne, noted that the partnership with Sembcorp provides an ideal vehicle to explore integrated data center, power, and energy solutions as the company accelerates its expansion across Asia.
"Scaling digital infrastructure means thinking about the energy pathways powering it from the outset," Khoo said. "Our approach is to secure the critical resources—including power, land, water, and connectivity—early, so we can execute with speed while building responsibly for the long term."
Under the terms of their newly signed framework, DayOne and Sembcorp will jointly evaluate the economic feasibility, business case, and implementation pathways for energy solutions tied to agreed projects. The agreement allows the partners to investigate reliable and cost-effective power solutions, advanced power generation and electrical infrastructure, fuel supply and storage mechanisms, renewable energy integration, and a suite of related technical and operational services.
According to DayOne, the MoU with Sembcorp serves as a vital building block for its broader sustainability roadmap. The company aims to source 100% of its energy consumption from renewable sources by 2030, wherever local market conditions and regulatory frameworks allow.
This partnership complements DayOne’s existing renewable energy footprint across Southeast Asia. In Singapore, DayOne has already secured a robust power purchase agreement with Sembcorp for its upcoming SG1 data center, which is slated to run entirely on renewable energy. Furthermore, in June 2026, the operator announced major renewable energy supply agreements in Malaysia. These pacts cover approximately 1.5GWp of solar capacity and 2.2 GWh of battery energy storage, leveraged through the country’s Corporate Renewable Energy Supply Scheme (CRESS). In addition, DayOne has finalized a dedicated power purchase agreement to supply renewable energy to its sprawling Chonburi Tech Park data center campus in Thailand, cementing its regional commitment to sustainable digital growth.
