Thailand suspends the construction of 49 data centers in order to develop new industry regulations, as governments worldwide tighten oversight of the facilities (Anuchit Nguyen/Bloomberg)

Bangkok, Thailand announced on Friday its intent to establish clearer guidelines for artificial intelligence (AI) data centres, aiming to regulate the rapidly expanding sector. Tech giants are rushing to invest billions of dollars in Southeast Asia due to the increasing demand for AI, driven by a growing user base equipped with internet connectivity.

However, the swift expansion has lagged behind regulation, sparking concerns globally about the environmental impact of these centres, including their electricity and water consumption, and their effects on local communities.

Thailand is attracting both local and foreign investors, eager to capitalize on the growing AI sector. Prime Minister Anutin Charnvirakul emphasized the need to align regulations with laws, standards, and the nation's interests. At the inaugural meeting of a new government committee on data centres, regulations will be revised to ensure they are stringent and prioritize public safety, he stated.

Currently, around 35 data centres are operational in Thailand. Another 49 are under construction, 11 projects have received approval, and 117 more are being reviewed. However, the government cannot halt the construction of these 49 data centres, as they are only advised to cooperate and halt their projects if they wish to do so, pending the introduction of clearer regulations expected next month.

The rapid rise of data centres is a global phenomenon, with the sector experiencing especially rapid growth in Asia. In March, Microsoft announced a US$1 billion investment in cloud and AI data centre infrastructure and operations in Thailand over the next two years, following Google's launch of a new cloud region in Bangkok in January. This new cloud region is projected to contribute more than US$40 billion to Thailand's economy over five years.

Nonetheless, there are growing concerns in Thailand about the absence of regulations up until now, which have allowed data centres to spring up without proper consideration or oversight. On Thursday, the energy ministry expressed concerns over a Bangkok data centre that had been stockpiling 200,000 litres of diesel in underground tanks without authorization.

Bangkok Governor Chadchart Sittipunt reported that the city had received six applications for standalone data centres, with three already operational since 2022 and the other three paused for review.