This article first appeared in Digital Edge, The Edge Malaysia Weekly on September 9, 2024 - September 15, 2024

Princeton Digital Group (PDG) is strategically capitalising on the increasing demand for data centres to support the artificial intelligence (AI) boom, recognising Johor as an ideal location for the development.

As AI continues to evolve, the need for larger, more efficient data centres has become critical to accommodating the substantial computing power required. AI’s rapid growth has driven the demand for large-scale facilities, faster construction methods and advanced cooling technologies to keep up with its expansion.

“AI growth came in and took the world by storm. Nobody saw it coming. But we need to build large-scale data centres to power these [AI] chips. There are very few places in the world where it’s suitable for these kinds of deployments because you need large pieces of land, strong and reliable power, strong connectivity and local talents that can operate [the data centres],” says Asher Ling, chief technology officer and managing director of PDG Singapore.

“Companies were looking around the world for locations where this works. [Now], Johor in Malaysia is recognised globally as such a location.”

The data centre provider will establish a 150mw AI-ready data centre in Sedenak Tech Park, Johor, to meet these demands. Dubbed JH1, PDGs AI-ready facility is one of the largest data centre campuses in Southeast Asia.

The first phase of the US$1.5 billion (RM6.6 billion) project was completed within 12 months of its announcement. The first phase comprises 52mw of the JH1 campus.

“If you had been here a year ago, this would have been a flat piece of land and you would not have seen anything out here,” says Ling.

The decision to invest in Malaysia, and Johor specifically, came after the moratorium of new data centres in Singapore, says Ling. This led to PDG exploring neighbouring countries for suitable locations.

Johor was ideal, thanks to its ample land, reliable power infrastructure and growing talent pool. PDG’s goal is to fully utilise the capacity of the Johor campus within the next two to three years.

“In fact, I would emphasise our investment and our scale in Malaysia is the largest in all the regions that [we are in]. It was the most recent foray for us, but it is now the largest and fastest in terms of the build,” says Ling.

PDG operates 21 data centres across six countries.

Just as factories rely on roads for transportation, data centres depend on connectivity to function efficiently, says Ling.

Malaysia’s key advantage is its extensive submarine cable networks, which connect the country to various parts of Asia and the world. This is because connectivity is a key component for data centre ecosystems to ensure seamless data transfer that supports the demands of businesses.

In turn, this encourages companies and support services to set up operations in the vicinity, says Ling. Data centres are able to gather direct investments for the country while fostering job creation and spurring economic growth. This is because the construction and operation of data centres require a wide range of suppliers, contractors and consultants, says Ling, leading to increased business opportunities for local companies.

There is a challenge of finding skilled data centre employees in Malaysia, as it is a relatively new sector, says Ling.

“The data sector industry in Malaysia really took off only two years ago. There are other similar mission-critical industries that have talented folks that want to move into this industry. For example, my operations director used to run a fabrication plant in Penang,” he says.

“Just like a manufacturing plant cannot go down in the middle of the day, a data centre can never go down. The mindset is transferable and we look into cross-training.”

The demand for data centre space in Johor is expected to be driven by both hyperscalers and enterprise clients, says Ling. While the company is not solely reliant on hyperscalers, they represent a significant portion of PDGs customer base.

The campus’ large footprint can accommodate high-density computing workloads, while the implementation of cooling technologies will allow the handling of intense heat generated by AI workloads, notes Ling.

For example, liquid cooling improves efficiency and energy savings compared to traditional cooling methods. He expects this technology to be prevalent in the coming years.

Sustainability is a concern for data centres. Ling says PDG is exploring opportunities to incorporate renewable energy sources into its operations, optimise energy efficiency and implement water saving measures.

PDG has also secured a US$280 million green loan for JH1, which aims to contribute to minimising resource consumption and emission. In addition, there are plans for solar panels to be installed on the rooftop of JH1.

By adhering to environmental standards and obtaining the relevant certifications, PDG is able to access financing options that support the data centre providers’ sustainability goals, notes Ling.

“For example, we use the most efficient chillers and spend more money [on this]. I’m willing to choose a more efficient chiller, which is more expensive; but, from a total cost of ownership when I’m operating, it’s a lot more efficient purely because of this,” he says.

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