Rising data centre demand pressures power capacity

Energy authorities are preparing to expand Thailand's electricity generation capacity amid mounting concerns that rising demand from resource-intensive businesses, particularly data centres, could strain the national grid.

An energy official who requested anonymity said Thailand's current installed capacity is 46,191 megawatts, excluding renewable sources. Peak demand during the hot season reached 36,758MW, leaving a reserve margin of less than 30%.

That figure marks a decline from last year's 38% reserve margin, according to an energy analyst.

The official dismissed claims by some observers that Thailand has reserve capacity of more than 50%, stressing that intermittent sources such as solar, wind and biomass cannot be counted as reliable supply.

Solar and wind power are inter- mittent sources of electricity, with output dependent on sunlight and weather conditions, which can affect supply stability.

Concerns are growing that the rapid expansion of data centres could push reserve margins below the international benchmark of 15%.

Each facility consumes between 5-10MW, far higher than the average factory's demand of less than 3MW, the official said.

"State grids and power distributors are expanding distribution capacity in areas experiencing bottlenecks without building new power plants, especially now that data centres have begun operating in Thailand," he said.

Options to expand capacity include calling for bids for new power plants, repowering retired facilities and increasing the use of renewable energy.

However, gas-fired and coal-fired generation have limitations, the official noted.

Thailand's domestic gas supply has peaked, leaving the country more reliant on imported liquefied natural gas, which exposes it to price volatility.

While concessions for existing gas-fired plants could be renewed at a lower cost than constructing new ones, new coal-fired projects are off the table due to commitments to reduce greenhouse gas emissions under the UN Development Programme, the official said.

Senior officials have yet to discuss nuclear power, although small modular reactor technology is being considered internationally.

The official stressed any new capacity must be weighed carefully, given its impact on electricity prices, emissions and fuel security.

Thailand's energy planners now face a balancing act: meeting surging demand from data centre businesses while safeguarding supply stability and adhering to environmental commitments.