The government's upcoming measures to screen data centre investment projects in Thailand are designed to safeguard electricity security without derailing the country's ambition to attract foreign capital into this fast-growing industry, says an energy official who requested anonymity.
He insisted the framework would balance national energy needs with investor confidence.
The official said the measures are expected to take effect in the fourth quarter of this year, though the exact timing will be determined by the Energy Policy Administration Committee.
The Energy Regulatory Commission (ERC), which is drafting the rules, has declined to comment on whether the new requirements could dampen investment prospects in resource-intensive data centres.
"Our task is only to examine whether these investments affect national energy security," said ERC secretary-general Poonpat Leesombatpiboon.
The measures under consideration include requiring developers to pay additional fees, such as upfront deposits and a new electricity tariff.
Data centres, often referred to as server farms, have come under scrutiny due to their massive electricity and water consumption for cooling systems, as well as complaints about noise pollution.
NO SIGNIFICANT IMPACT
The official believes the measures can coexist with Thailand's plan to attract data centre investment, though it remains unclear whether existing operators will be required to comply.
The rules are intended to regulate the number of data centres and ensure limited resources are managed to maximise national benefit.
"The measures are implemented on a foundation that still allows sustainable investment in industries and businesses targeted for long-term growth," the official said.
The new regulations are likely to apply mainly to new operators who have not yet received incentives from the Board of Investment (BoI), said the official.
Mr Poonpat noted the government must decide whether the measures will apply retrospectively to data centres that have already secured BoI incentives.
"We would not like investors to panic, but fairness must be ensured. The principle is equality and justice for all parties," he said.
The Energy Ministry source added that enforcement should begin around the start of the fourth quarter, citing the surge in applications for data centre projects.
"We need to act quickly," he said.
The timing also aligns with the completion of Thailand's 2026 power development plan, expected by the end of the third quarter, ensuring consistency in energy policy.
SCREENING MEASURES
The ERC said the screening measures will establish standards to manage both fossil fuel and renewable energy resources efficiently, while avoiding placing additional burdens on the public.
"This will transform our role from a traditional utility rate setter to an ecosystem architect, safeguarding power stability and preventing cost shifts onto Thai consumers," said Mr Poonpat.
Projects will be screened based on tangible national economic output, he said.
Hyperscale data centres that invest heavily, generate local employment and contribute tax revenue will be prioritised over general facilities such as cryptocurrency mining operations or passive storage warehouses.
To prevent "phantom loads" -- where companies reserve far more power capacity than they actually use -- operators will be required to pay upfront deposits or bonds to secure grid access.
According to media reports, investors must place a guarantee of 4.5 million baht per megawatt to prevent hoarding electricity capacity and to demonstrate genuine investment intent.
Applicants must also show evidence of commercial operations within 5-7 years.
Failure to meet these commitments will result in the immediate revocation of assigned capacity, which will then be reallocated to industrial operators in the real economy.
Data centres with heavy loads -- some requiring up to 500MW -- pose significant risks to grid frequency and voltage stability.
Under the screening measures, operators will be required to install localised energy storage systems, such as battery energy storage units, to mitigate these risks. "This requirement is based on self-care and stability principles," Mr Poonpat said.
If additional power demand forces state utilities to activate emergency generation, operators must pay ancillary service charges to cover the technical costs.
Authorities will also impose a Type 9 electricity tariff, ensuring commercial operators bear incremental fuel costs.
Under Thailand's merit-order dispatch system, low-cost hydro, imported Lao power and coal are prioritised before higher-cost natural gas.
Spikes in data centre demand often force the grid to use expensive imported liquefied natural gas.
The Type 9 tariff requires data centres to pay actual marginal generation costs directly, preventing household electricity bills from rising as a result of higher fuel tariffs.
FUTURE PROPOSALS
The Thailand Data Center Association was recently invited to meet a subcommittee studying national digital infrastructure development under the House Committee on Communications, Telecommunications and Digital Economy and Society, in order to present proposals to promote Thailand's data centre industry.
The association said Thailand has real, contracted demand for data centres, and the question facing the country is not whether to accept it, but what to ask of it.
The group proposed data centre power purchase agreements be approved according to confirmed available power and released in tranches, so grid commitments track actual capacity rather than the power purchase application queue.
The association also suggests setting a "Made in Thailand" and/or "Buy in Thailand" requirement for data centre equipment.
In addition, the group proposes funds from the Digital Economy and Society Ministry or BoI be capitalised to build Thai-owned data centre and AI supply chain companies.
