Malaysia to Add 9 GW Gas Capacity as It Phases Out Coal by 2044

Malaysia will require an additional 9 gigawatts (GW) of gas-fired electricity generation to keep pace with rapidly growing energy consumption, Economy Minister Akmal said on Tuesday. The announcement came at an Energy Commission conference, where he outlined planning for the country's transition away from coal.

The minister explained that electricity demand is projected to rise substantially, driven by two key factors: a boom in artificial intelligence (AI) data centres and higher temperatures linked to climate change, which increase cooling needs.

Malaysia has emerged as Southeast Asia's fastest-growing data-centre hub, drawing billions of dollars in investment from global technology firms such as Amazon and Microsoft. This digital infrastructure expansion is placing significant strain on the national grid.

New gas generation capacity is considered essential as Malaysia prepares to retire its final coal-fired power plants by 2044. "This is the planning... to ensure that we will be able to manage the demand," Akmal told reporters.

The move positions natural gas as a transitional fuel, bridging the gap between the current coal-dependent system and future cleaner energy sources, while supporting the nation's economic growth ambitions.