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Asia’s AI boom has a dirty secret: the coal that powers it

Asia's AI boom is driving a surge in coal consumption as data centers demand round-the-clock power that solar and wind cannot yet reliably provide, according to market research analyst Alexander Kheder of BMI. The region holds nearly three-fifths of the world's known coal reserves, making coal a cheap and reliable stopgap source for AI infrastructure, despite its environmental cost.

read1 min views49 publishedJul 18, 2026
Asia’s AI boom has a dirty secret: the coal that powers it
Image: Scmp (auto-discovered)

In the rush to build the digital future, regional tech hubs are digging up the past

Asia sits atop vast amounts of coal, nearly three-fifths of the world’s known reserves by some estimates.

Cheaper and more reliable than imported oil and gas, and far less vulnerable to disruptions caused by foreign wars, coal is also dirty, polluting – and the region’s No 1 “stopgap source” to power the AI infrastructure roll-out.

“AI demand is materialising faster than clean energy generation can be commissioned,” said Alexander Kheder, a market research analyst at BMI who tracks global AI infrastructure spending and data centre expansion.

Solar and wind, for all their recent progress, still could not deliver the relentless, round-the-clock baseload that the data centres powering artificial intelligence demanded, he said.

Malaysia’s pioneering smart city of Cyberjaya, dozens of data centres are already in operation, with more planned for the future.

“The impact is going to be very, very visible,” said Adit Rahim, 49, a local resident and communications executive who worries about the strain all this development is placing on utilities.

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