Rising tariffs and stricter regulations are prompting data centres in Malaysia’s Johor state to seek alternative water sources for their cooling systems.
Reverse osmosis membranes at the Ulu Tiram water reclamation plant, designed to convert treated wastewater into high-grade water for data centre cooling (Image: The Straits Times)
A growing number of operators are adopting wastewater reclamation, using technologies such as reverse osmosis, similar to Singapore’s Newater. Bridge Data Centres, DayOne, Computility Technologies and AirTrunk are among the firms making the shift. Bridge has built Johor’s first large-scale water reclamation plant and pipeline network to support its upcoming 400MW campus in Ulu Tiram, located 15km from Johor Bahru, which is scheduled to begin operations in 2027.
Construction progress at Bridge Data Centres’ upcoming 400MW campus in Ulu Tiram, Johor (Image: The Straits Times)
Bridge’s chief executive officer, Eric Fan, explained that resource constraints at its first site in Sedenak Tech Park, Kulai, have intensified due to competition. “We decided we need to develop a new region to serve our customers’ demands, that’s why we are moving out of Sedenak into a new region,” he said.
Partnerships and agreements
On 11 Aug, Indah Water Konsortium (IWK) and Johor Special Water (JSW) signed three agreements to provide alternative water sources. Under the deals, IWK will supply 12 million litres per day of treated effluent to Bridge and Computility, while DayOne will treat raw water from the Tebrau River for its second campus in Kempas. AirTrunk also announced in Apr that it will use recycled water for its Johor Bahru facilities.
Sampling reclaimed water at Bridge Data Centres’ Ulu Tiram facility, using reverse osmosis technology supplied by Suntar International Group (Image: The Straits Times)
Growth pressures
Johor has become a major hub for data centres in South-east Asia, partly due to Singapore’s moratorium on such developments from 2019 to 2022. The boom has strained local resources. Johor had just 10MW of data capacity in early 2021, but now counts 47 planned and operational data centres with a projected capacity of 5.7GW, according to a July 2025 report by market intelligence provider DC Byte. Of this, 487MW is already in operation.
Cooling requirements are immense: a 100MW data centre consumes about 4.16 million litres of water daily, roughly the usage of a city with 10,000 residents.
New tariffs and regulations
Authorities have introduced measures to prevent industrial consumption from affecting household supply. Since Aug, operators pay RM5.33 (S$1.62) per cubic metre of water, RM1 to RM1.75 more than the previous non-domestic tariff. The federal government is considering similar policies in other states.
In Apr 2024, Johor introduced guidelines that encouraged the use of renewable water and energy. By Nov that year, officials reported rejecting almost 30% of applications due to insufficient sustainable practices.
Bridge’s reclamation facility
Bridge’s reclamation plant, completed in Jun 2025 after 10 months of construction, was self-funded at a cost of several million dollars. The facility serves its 20ha Ulu Tiram campus and sources treated sewage effluent from IWK’s plant 6.5km away.
The plant currently processes five million litres daily, with plans to expand to 20 million litres as demand grows. It uses membrane technology from Singapore’s Suntar International Group, with multiple passes of reverse osmosis to produce high-grade water from wastewater.
Bridge’s first Johor campus, MY06 in Sedenak, launched in 2022, is a 600MW site with 255MW expected to be operational by end-2025. It continues to rely on conventional treated water.
The water reclamation facility at Ulu Tiram, Johor, where treated effluent is processed for use in cooling data centres (Image: The Straits Times)
Competition for resources
Analysts note that Sedenak’s limited capacity is driving operators to new areas. Vivian Wong, lead analyst at DC Byte, said: “In Johor, there is currently no available power capacity at Sedenak Tech Park, with its first phase fully sold, and the next availability expected in Q4 2026.” She added that Bridge’s Ulu Tiram project is the first in the region, offering quicker access to resources.
Johor officials have said upgrades to Sedenak’s water and power supply should be completed by 2027.
Sustainability concerns
Experts caution that simply moving facilities may not resolve resource scarcity. Dr Mohd Fadhil Md Din from Universiti Teknologi Malaysia warned that opening new campuses in different regions may shift, rather than solve, pressures on water supply.
Still, the adoption of reclaimed water is seen as a positive development. Charles Santiago, former chairman of Malaysia’s National Water Services Commission (Span), said: “Any effort that uses alternative water must be welcomed. It signals that there is strong public and private commitment.” He added that the industry should also consider rainwater harvesting and desalination.
Source: The Straits Times
