Indonesia is identifying key challenges in electricity and water availability, technology, regulations, and human resources to support the development of its data center industry, following the first meeting of the National Data Center Team in Jakarta on Tuesday (10/11).

Deputy Minister of Industry Faisol Riza said the meeting brought together several ministries and government agencies, state-owned electricity company PT PLN (Persero), and data center industry representatives to discuss potential challenges related to industry operations and investment.

Indonesia Identifies Key Challenges for Data Center Development

Faisol said the first meeting aimed to identify various issues that could emerge as data center operations and investment activities develop in Indonesia.

"The first meeting discussed and identified several issues that may arise in the future when data centers begin operating and when investments in data centers take place," he said.

The discussions covered regulations, supporting infrastructure, particularly electricity and water supplies, and the use of technology to improve operational efficiency.

Faisol added that the meeting would also establish further discussion agendas, including technical meetings to address the identified challenges.

Government Proposes 10 Provinces for Data Center Development

The Ministry of Industry proposed discussing the development of data centers in several regions with existing industrial areas.

Around 10 provinces have been proposed for further assessment, including areas in Central Java and East Java, as well as several regions outside Java.

However, the locations have not yet been finalized. Further discussions will consider input from relevant ministries and government agencies, as well as the readiness of each region.

Ichsan Zulkarnaen, Deputy for Investment Planning at the Ministry of Investment and Downstreaming/Investment Coordinating Board (BKPM), said technical meetings would follow to formulate solutions to issues involving energy, electricity availability, technology, and human resources.

He also said Indonesia was examining data center developments in neighboring countries as references.

"For now, we are also looking at several large data centers in Singapore and Malaysia, which serve as one of our benchmarks," he said.

Electricity and Infrastructure Readiness Under Discussion

Kartika Listriana, Director General of Marine Spatial Planning at the Ministry of Marine Affairs and Fisheries, expressed support for data center industry development, including through the alignment of licensing procedures for marine space utilization.

Meanwhile, PLN Retail and Commerce Director M. Fahrur Rozy said the company was ready to support potential data center investments in Indonesia.

However, he emphasized that electricity requirements for the industry must be considered alongside the availability of electricity for the public to ensure that public services are not disrupted.

Indonesia's Data Center Capacity Projected to Reach 11.7 GW by 2030

Rakhmad Tunggal Affirudin, President Director of Telkom NeutraDC, said the data center industry has significant potential to support Indonesia's digital ecosystem and artificial intelligence (AI) development, as well as strengthen national digital sovereignty.

He stated that Indonesia currently has approximately 600 megawatts (MW) of operational data center capacity.

Meanwhile, projected capacity requirements are expected to reach between 3 gigawatts (GW) and 11.7 GW by 2030.

Rakhmad also estimated that capital expenditure (capex) for data center construction in Indonesia ranges from US$7 million to US$9 million per megawatt.

Based on this estimate, the development of the data center industry is expected to involve substantial investment potential.

PHOTO: MINISTRY OF INDUSTRY

This article was created with AI assistance.

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