Southeast Asia is rapidly embracing AI, but there is still insufficient transparency about the environmental impact of the data centres and infrastructure that power AI systems. Governments should require stronger reporting on energy and water consumption to ensure AI growth aligns with climate goals
Summary
Southeast Asians are divided on AI’s environmental impact. Survey data shows 47.9% view it positively, 30.2% negatively, and 21.9% are uncertain. Data centers consume growing electricity and water resources. Governments should mandate transparency requirements and green energy policies similar to EU standards to build public trust and ensure sustainable AI infrastructure development.
Key Points
• Southeast Asians are divided on AI’s environmental impact, with 47.9% viewing it positively, 30.2% negatively, and 21.9% uncertain, reflecting a lack of transparency from data centres and AI companies about their energy and water demands.
• Data centre electricity consumption is projected to double from 415 terawatt-hours in 2024 to 945 terawatt-hours by 2030, while individual AI query impacts remain largely undisclosed, with only Google publishing peer-unreviewed estimates.
• ASEAN governments should implement mandatory transparency policies requiring data centres to report energy and water usage annually, similar to EU regulations, rather than relying on individual behavioural changes to address AI’s environmental footprint.
ASEAN Needs a Common Framework for Responsible AI Growth
As Southeast Asia accelerates its adoption of artificial intelligence, policymakers face a growing challenge: how to harness AI’s economic potential without compromising sustainability, transparency, and public trust.
AI is rapidly becoming a strategic priority across ASEAN. Governments are promoting digital transformation, businesses are integrating AI into their operations, and investment in data centres is surging across the region. Yet while discussions often focus on innovation and competitiveness, the environmental and governance implications of AI have received far less attention.
The issue is not AI itself, but the infrastructure that powers it.
Behind every AI application sits a vast network of data centres consuming significant amounts of electricity and water. As demand for AI services expands, so too will the need for computing capacity. Countries such as Malaysia, Singapore, Indonesia, and Thailand are increasingly positioning themselves as regional digital infrastructure hubs. Without appropriate safeguards, this growth could place considerable pressure on energy systems and natural resources.
Transparency Must Come First
One of the most significant obstacles facing policymakers is the lack of reliable information.
Few technology companies publicly disclose the full environmental footprint of their AI operations. Data on electricity consumption, water use, and emissions remain limited, making it difficult for governments, investors, and citizens to assess the true costs and benefits of AI deployment.
ASEAN should therefore prioritise the development of a regional AI transparency framework requiring major AI operators and data-centre providers to report key sustainability metrics. A common reporting standard would provide comparable data across member states while enhancing accountability and investor confidence.
Building Sustainable AI Infrastructure
ASEAN’s digital ambitions must be supported by sustainable infrastructure policies.
Governments should encourage AI operators to increase their use of renewable energy through incentives, power purchase agreements, and regional clean-energy trading mechanisms. New data-centre approvals should also consider factors such as water availability, grid capacity, climate resilience, and local environmental impacts.
Sustainable site selection is especially important as competition intensifies to attract foreign technology investment. Economic benefits should not come at the expense of long-term environmental security.
A Regional Approach to AI Governance
The environmental dimension is only one part of the challenge.
As AI systems become more influential in finance, healthcare, education, and public administration, ASEAN will also need stronger governance mechanisms. This includes independent audits of high-impact AI systems, environmental impact assessments for large-scale deployments, and clear accountability structures for both public and private sector users.
A fragmented regulatory environment risks creating uncertainty for businesses while weakening public trust. Regional cooperation can help establish common standards without stifling innovation.
Investing in Green AI Innovation
ASEAN should view sustainability not as a constraint but as a competitive advantage.
The region has an opportunity to become a leader in the development of energy-efficient AI models, advanced cooling technologies, and next-generation green computing solutions. Strategic investments in research and development could help member states build domestic capabilities while reducing the environmental costs of future AI growth.
Universities, research institutions, and industry partners should be encouraged to collaborate on technologies that make AI both more powerful and more resource-efficient.
The Case for an ASEAN AI Observatory
To support evidence-based policymaking, ASEAN should consider establishing a regional AI and Sustainability Observatory.
Such a body could monitor data-centre expansion, track environmental performance, publish regional benchmarks, and share best practices among member states. Reliable data would enable governments to make informed decisions while helping industry identify areas for improvement.
Balancing Growth and Responsibility
Artificial intelligence will undoubtedly play a crucial role in Southeast Asia’s future economic development. However, success should not be measured solely by investment figures, data-centre capacity, or AI adoption rates.
The region’s long-term competitiveness will depend on whether AI growth remains aligned with sustainability goals, energy security, and public accountability.
For ASEAN, the objective should be clear: build an AI ecosystem that is not only innovative and competitive, but also transparent, resilient, and environmentally responsible. As the region races to embrace artificial intelligence, responsible governance may prove to be its most important innovation of all.
Source : Transparency Needed as Southeast Asia Pushes Ahead on AI | FULCRUM
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