Malaysia Plans National Reclaimed Water Policy for Digital Economy

The Malaysian government is developing a National Reclaimed Water Policy, a long-term framework designed to enhance the efficiency of the nation's water usage. Deputy Prime Minister Datuk Seri Fadillah Yusof announced that this policy is part of a broader national response to address significant challenges in the energy, water, and digital infrastructure sectors.

Water is identified as a critical component for the burgeoning digital economy, with data centers being major consumers for system cooling. The policy emphasizes efficient water resource management through reclamation as key to ensuring the sustainability of digital investments without compromising domestic needs. Malaysia currently produces 48.5 million liters of reclaimed water daily and aims to boost this capacity to 118 million liters by 2030, primarily for industrial use.

This initiative is not isolated but forms an integrated national response to the challenges at the intersection of energy, water, and digital infrastructure. Fadillah, who also serves as the Minister of Energy Transition and Water Transformation, revealed that a dedicated data center task force has been formed. This task force, chaired by the Ministry of Investment, Trade and Industry (MITI), is responsible for evaluating the types of data centers Malaysia wishes to attract, ensuring they represent the latest technology and are genuinely needed.

The existing policy already differentiates between water for public consumption and industrial use. Treated water is designated for consumers, while reclaimed water or recycled wastewater is allocated for industrial purposes. The implementation of reclaimed water usage has commenced in states like Johor, through a collaboration between Indah Water Konsortium (IWK) and Johor Special Water (JSW), with plans to expand to Selangor and Negeri Sembilan.