IESR: Government needs to issue regulations regarding data centres
Jakarta (ANTARA) - The Institute for Essential Services Reform (IESlar) has stated that the government needs to accelerate the issuance of regulations regarding AI safeguards and data centres, making environmental, social, and energy standards a prerequisite for licensing.
“Without national standards, every project is assessed on a case-by-case basis, and oversight depends on the initiative of regional heads,” said IESR Chief Executive Officer Fabby Tumiwa when confirmed in Jakarta on Friday.
According to him, the halting of a data centre project in Jatiluhur, West Java, demonstrates that Indonesia does not yet have adequate rules of engagement to face the wave of investment in data centres and AI.
In May, the Ministry of Communication and Digital estimated that Indonesia’s electricity demand for data centres could reach more than 2 GW by 2029. Meanwhile, PLN estimates that electricity demand for data centres could reach 25 GW by 2035.
For this reason, IESR is urging the central government—specifically the Ministry of Communication and Digital, the Ministry of Energy and Mineral Resources, the Ministry of Environment, the Ministry of Public Works, and the Coordinating Ministry for Economic Affairs—to take action.
This includes the immediate issuance of AI and data centre safeguard regulations that make environmental, social, and energy standards a condition for permits.
“Mandating all data centres in Indonesia to use waterless cooling systems or closed-loop circulation, so they do not compete with the needs of drinking water and agriculture,” he said.
Additionally, IESR is urging the government to set a Power Usage Effectiveness (PUE) efficiency limit below 1.3 and establish IT equipment efficiency standards that can reduce energy consumption for all data centres.
Furthermore, the government needs to mandate that data centres use renewable energy directly, at a minimum of 35 per cent by 2030 and 50 per cent by 2040, through on-site generation or renewable energy power purchase agreements, rather than merely relying on certificates.
This obligation, according to Tumiwa, is in line with the direction of the National Energy Policy (PP 40/2025), which targets a new and renewable energy mix of 36-40 per cent by 2040. As a new sector with high energy demand and strong capital, data centres should achieve this earlier, rather than burdening the achievement of national targets.
“Indonesia wants to become a data centre hub in the region. That is an opportunity, but only if the data centres built are water-efficient, efficient, and powered by renewable energy. If not, we will bear the emissions and water crisis to serve global computing demand. The government needs to move quickly before dozens of similar projects are locked in with low standards,” he added.
IESR stands ready to support the central and regional governments in drafting green data centre standards that protect the community, the environment, and the climate.