Kuala lumpur: Energy is no longer just about powering homes but has become a critical driver of the growing artificial intelligence (AI) ecosystem and the rapid expansion of computing, data centres, advanced manufacturing, and electric mobility. The rapid expansion of data centres is also driving up electricity demand, underscoring the growing role of the digital economy and the need for a stable and reliable power supply.
According to BERNAMA News Agency, Tenaga Nasional Bhd (TNB) senior chief network officer Mahathir Nor Ismail said Malaysia is entering a new decade of rising electricity demand driven by 'new load classes' such as data centres that require a stable 24/7 low-carbon power supply. In Malaysia alone, there are currently 36 data centres with a combined capacity of about 4.5 gigawatts (GW), while another 23 projects with a capacity of approximately 3.7GW are under construction, and 79 projects with about 25.6GW are in the planning stage. Globally, electricity consumption is also expected to continue rising in the future.
Mahathir Nor stated that this is why 'Energy for AI' has become a key focus area at Energy Transition Conference 2026 (ETCon26), as it is closely linked to digital economic growth and the future of energy systems. AI growth is significantly reshaping the country's energy demand landscape, with electricity demand becoming more continuous, complex, and large-scale rather than cyclical. Forecasts show that electricity demand could grow by around four to six per cent annually. The increase is not driven solely by data centres, but also by industrial electrification, smart buildings, and electric mobility.
Therefore, TNB is strengthening its readiness through smart grid development, digitalisation, and investments in renewable energy to support the growth of the AI economy. Technologies such as AI are being used for load forecasting and predictive maintenance to ensure the system becomes more efficient and proactive. At the same time, TNB is building a more flexible grid to support a wide range of new demand sources.
Large-scale investments in energy infrastructure are essential to ensure Malaysia can continuously support the rapid and stable growth of the AI economy. Under the Incentive-Based Regulation (IBR) framework, RM43 billion has been allocated to modernise and strengthen the grid under Regulatory Period 4 (RP4), double the amount invested during the previous cycle, RP3. Energy supply security remains TNB's priority to ensure the grid network can meet rising demand and support the energy transition through increased renewable energy capacity.
In addition, initiatives such as the Battery Energy Storage System (BESS) will help ensure supply consistency by storing and distributing energy based on demand, while improving overall grid efficiency. A landmark milestone was achieved under the initiative with the launch of BESS Santong in Dungun, with a capacity of 100 megawatts (MW) or 400 megawatt-hours (MWh) - the first in Malaysia to be connected to the grid. The project, launched by Deputy Prime Minister Datuk Seri Fadillah Yusof, who is also the Minister of Energy Transition and Water Transformation, can accommodate electricity demand equivalent to powering 40,000 households.
Malaysia has significant potential to emerge as a regional digital hub by leveraging its stable grid infrastructure, competitive energy costs, and access to renewable energy. Through initiatives such as the ASEAN Power Grid (APG), Malaysia could further strengthen supply flexibility and energy security through cross-border energy sharing. Malaysia plays an important role in ensuring the success of the APG through several major projects, including the Vietnam-Malaysia-Singapore (VMS) Interconnection. Such initiatives enable Malaysia to offer not only competitive costs, but also energy reliability and sustainability, which are among the key priorities for global investors.
ETCon26, which will be held from June 3 to 5, 2026, at the Kuala Lumpur Convention Centre, will not only strengthen the synergy between energy and AI but also serve as a strategic platform to promote dialogue on energy transition implementation in Malaysia and the ASEAN region. Prime Minister Datuk Seri Anwar Ibrahim is scheduled to officiate the conference on the second day.
According to Mahathir Nor, ETCon26 highlights the need to build a more flexible and smarter energy system capable of supporting future economic growth. Through ETCon26, the targeted outcomes go beyond discussions and include concrete actions such as policy alignment, strategic investments, and the implementation of technologies, including smart grids and clean energy. The conference serves as a platform to bring together regulators, governments, utilities, investors, and industry players under a common goal of ensuring AI growth is supported by a sustainable and resilient energy system.
The main objective of ETCon26 is to align policies, investments, and technological innovation within a collaborative ecosystem involving policymakers, industry players, investors, and the public. Themed 'Energy and AI: The Synergy for Energy Transition', the conference is built around three content pillars, namely 'Energy for AI', 'AI for Energy', and 'Energy Transition (ET) for People'. Energy for AI is about ensuring clean energy supports the digital world, AI for Energy is about making the power supply system more efficient and reliable, while Energy Transition for People ensures the benefits of the energy transition are inclusive and improve people's quality of life.
Those interested may register via the conference website at the-etconference.com (https://the-etconference.com/) and use the promo code ETCON26BERNAMA for a special offer.