Thaksin vows cheaper power to turn Thailand into data centre hub

16.03.2025 16:26
businesstimes.com.sg
Keywords: Thailand's plan to reduce electricity costs by over 25% to attract data centers and AI investments., Investment commitments from tech giants like Amazon, Google, ByteDance, and Alibaba for data center and cloud projects in Thailand.

Thaksin Shinawatra aims to reduce Thailand's electricity costs by over 25% by next year to attract data centers and AI infrastructure investment, targeting a tariff of about 8 US cents per unit from the current 11 US cents. He seeks to leverage investments from tech giants like Amazon and Google while promoting green energy to make Thailand competitive in the global data center market.

Estimated market influence

Thailand

Positivesentiment_satisfied

Analyst rating: —

Thailand aims to reduce electricity costs by over 25% to attract investments from tech companies like Amazon, Google, ByteDance, and Alibaba for data centers and AI infrastructure.

Amazon.com

Positivesentiment_satisfied

Analyst rating: Strong buy

Amazon has committed investment in Thailand's data center projects as part of the country's plan to become a hub for AI and cloud services.

Alphabet (Google)

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Analyst rating: N/A

Alphabet's Google has invested in Thailand's data center and cloud service projects, aligning with the government's strategy to reduce electricity costs and attract tech investments.

ByteDance (TikTok)

Positivesentiment_satisfied

Analyst rating: N/A

ByteDance's TikTok has committed investment in Thailand's data center projects as part of the country's push to become a leading hub for AI infrastructure.

Alibaba Group

Positivesentiment_satisfied

Analyst rating: Strong buy

Alibaba Group has invested in Thailand's cloud service and data center projects, supporting the government's initiative to reduce electricity costs and attract tech investments.

Context

Analysis and Summary: Thailand's Push to Become a Data Center Hub

Electricity Cost Reduction Plan

Targeted reduction in electricity costs by over 25% by next year, aiming for rates down from ~11 US cents per unit to ~8 US cents.
Stepwise reduction plan to lower tariffs to 2.50 baht (≈0.12 USD) per unit.

Attracting Tech Investments

Secured billions in investments from tech giants like Amazon, Google, ByteDance, and Alibaba for data centers and cloud services.
Focus on leveraging Thailand's strategic location and cost advantages to attract global tech firms.

Competitive Landscape in Southeast Asia

Aims to compete with other regional hubs like Singapore by offering cheaper energy.
Emphasis on green energy to align with global sustainability trends and investor preferences.

Green Energy Considerations

Acknowledged reliance on fossil fuels and natural gas limits cost reduction potential.
Targets ideal electricity costs of 2-6 US cents per unit, considered optimal for investors.

Long-term Vision and Infrastructure Development

Vision includes establishing a Bangkok data center area housing global tech companies and developing an AI hub.
Plans to expand infrastructure to support advanced electronics manufacturing and EV investments.

Economic Impact and Foreign Investment Surge

Post-military rule saw foreign investments surge, with 1.14 trillion baht pledged last year, the highest in a decade.
Focus on sectors like electric vehicles and tech services to drive economic growth.

Regulatory and Policy Environment

Thaksin's influence suggests strong government commitment to policy execution despite not holding an official position.
Potential regulatory reforms expected to facilitate investments in green energy and tech infrastructure.

This strategic push positions Thailand as a key player in the global data center and AI sectors, leveraging cost reductions and green initiatives to attract significant foreign investment.