Philippine Business Leaders Question Data Centre Push Amid Energy, Job Concerns
Senior Philippine business figures urge a re-evaluation of data centre investments. They cite critical power shortages, high resource demands, and limited job creation as key issues.
Reconsidering Data Centre Ambitions
George Barcelon, chairman emeritus of the Philippine Chamber of Commerce and Industry, questioned the country's focus on data centre investments. He urged prioritising industries that create more jobs and strengthen domestic supply chains. Data centres consume significant electricity and water, yet generate few employment opportunities.
Barcelon, also president of technology solutions firm Integrated Computer Systems, highlighted Singapore's tighter hyperscaler regulation. Singapore's data centres already account for nearly 20 per cent of its electricity usage.
Persistent Energy Instability
The Philippines contends with potential power shortages and rotational brownouts. The Visayas grid was under red alert this August and earlier this year due to tight supply. Multiple power plant outages prompted warnings of impending blackouts from the grid operator.
Luzon also faced red and yellow alerts, with the National Grid Corporation of the Philippines implementing brownouts. This occurred in provinces like Pampanga, a proposed site for the Pax Silica hyperscaler hub. Such large, continuous electricity loads could hinder energy security efforts.
High Resource Demands and Investment Risk
Jay Joel Soriano, Head of Strategy and Planning at First Gen Group, noted investor concern over power supply predictability. He stated high electricity prices are manageable, but sudden spikes and grid alerts complicate business planning. Filipino consumers pay some of Southeast Asia's highest electricity rates, second only to Singapore.
A single hyperscaler can demand 500 megawatts (MW) to 1 gigawatt (GW) of power. The proposed 1,620-hectare Pax Silica site could require up to 3GW of electricity and 39 billion litres of water annually. This water demand equals the use of about 600,000 households.
The substantial resource requirements and high electricity costs present significant operating expenses for hyperscalers. Geopolitical tensions also make energy transition more urgent for the Philippines, aiming to reduce external supply chain exposure. Barcelon suggests using the Pax Silica opportunity to build domestic critical-mineral processing capacity instead.
This approach aligns better with national goals for job creation and supply chain strengthening. Investors should carefully assess the Philippines' energy infrastructure and resource availability when considering data centre viability.
This article is journalism, not investment advice; consult a licensed professional before making financial decisions. Market data is indicative, may be delayed, and should be verified with your broker or exchange before use.
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