Amid the brouhaha over AI data centre investment, a government report recommending new legislation to regulate these resource-guzzling projects deserves praise and attention.
Industry Minister Varawut Silpa-archa has ordered officials to draft a law regulating data centre investment in Thailand. The legislation will impose clear standards to prevent the impact of heavy water use and pollution.
Deputy Prime Minister and Finance Minister Ekniti Nitithanprapas, meanwhile, has ordered the Board of Investment (BoI) to revise its strategy. Instead of focusing on selling vacant land in unoccupied industrial estates, the BoI is to draw up an investment strategy that makes Thailand a data centre hub. It will also focus on developing clean and renewable energy and on creating a specific zone for AI data centres linked to undersea cables.
The question is whether these guardrails will arrive in time to match the government's drive to attract investment. The bigger question is whether the government can enforce such stringent policies once the money is on the table -- or whether it will end up appeasing investors, as it always has.
So far, the BoI has approved 16 AI data centres. None of them has been built yet, and the country still lacks a specific legal framework for these digital installations.
The Commerce Ministry has already issued 1,145 permits for AI data centre businesses, 669 of them in Bangkok and most of those on Rama IX Road. The rest are scattered across Nonthaburi, Pathum Thani, Phuket, Chon Buri, Nakhon Ratchasima, Rayong and Khon Kaen.
At present, approvals for data centre projects rely on building control and land-use regulations, as the facilities are not classified as factories under existing law.
What will the government and local administrations do with the medium and small centres that are, in effect, warehouses full of computers doing calculations -- servers packed with high-powered processing chips? These need massive cooling systems, because the chips generate enormous heat. Many sites use water-based cooling, and all of them need backup power systems.
The government must put more effort into creating guardrails to regulate data centres. New York Governor Kathy Hochul has enacted a one-year statewide moratorium on new large-scale AI data centres drawing 50 megawatts or more. The state is preparing a framework, including a generic environmental impact statement, to set consistent standards for energy demand, water use and quality, and air quality, with guidance to ensure companies share benefits with host communities and manage pollution responsibly.
Environmental experts here have already demanded the government conduct a strategic environmental assessment to establish the economic and social costs and benefits of data centres in a given area.
The speed of AI adoption in Thailand must not be judged by the volume of investment. The government and communities must have the ability to plan and decide whether these projects are worth building, where they should be built, and what their impact will be. Without those answers, Thailand will end up selling cheap land, water and electricity to industrial investors -- as it has been doing for the past several decades.
