Instability of PHL electricity grid preventing data centers from achieving scale — Moody’s

The Philippines' ambition to expand its data center capacity to 1.5 gigawatts by 2028 faces a significant hurdle in its unstable electricity grid. Moody’s Ratings points out that energy security shortcomings are a key bottleneck, placing the Philippines and Vietnam in the "early-stage" data center market category. This contrasts sharply with Malaysia and Singapore, which have already captured substantial economic benefits from data center investments. For Southeast Asia, this situation underscores a broader challenge. While the region is well-positioned for digital trade due to high openness and rapid digital adoption, it struggles with funding, construction, and utility access. Delays in securing power and water could constrain growth across several markets, including India, Thailand, and Indonesia, where data center investments are significant but not yet primary growth drivers. The vulnerability of power supply to external shocks, like rising oil prices, further complicates the outlook for the Philippines.