Taps Run Dry in Batam as AI Data Centres Arrive: The Hidden Water Cost of the AI Boom

In Batam, an Indonesian island just south of Singapore, cooking dinner and taking a shower have become daily struggles. Taps have run dry in some neighbourhoods, and residents say the problem began as huge new data centres — the buildings that power the world’s artificial intelligence tools — started rising on the island.

The story of Batam is now a warning for the whole of South-East Asia. The region is racing to build the computing power behind the AI boom, but the machines that make AI work need enormous amounts of water and electricity. In places where water is already scarce, local people are asking a simple question: who gets the water first — the servers, or the families who live next door?

At a glance

• What happened: Residents of Batam, Indonesia, have protested after household taps ran dry while new AI data centres were built on the island.
• Where: Batam, an island of about 1.3 million people in Indonesia’s Riau Islands, just south of Singapore. The protests centred on Nongsa Digital Park, a new cluster of data centres.
• Why it matters: Data centre capacity in South-East Asia is projected to triple by 2030 as AI use surges. The Batam dispute shows the environmental cost of that growth — and the same tensions are appearing in Malaysia too.
• What is disputed: Residents blame the data centres for the shortages. The local government and the water company blame a long drought and a strong El Niño weather pattern.
• What has changed: In late September, the authorities told developers they must build plants to desalinate seawater for cooling, so they stop straining local water supplies.

“We cannot eat rice without water”

Juniardi Adinda Sembiring Gurukinayan, a 54-year-old tradesman in Batam, remembers welcoming the new industry at first. “Thank God industry is coming,” was his first reaction, he told the news agency AFP.

Then the water stopped. Severe outages hit the municipal water service in some communities, and Juniardi said that “sometimes I skipped my shower”. His complaint was simple and direct: “We cannot eat rice without water. We cannot cook vegetables without water.”

At the worst point, dozens of angry residents staged spontaneous protests outside Nongsa Digital Park, the new cluster of data centres and other facilities that has been designated a special economic zone. People in the district believe “that the water shortages… are related to the construction of data centres”, Juniardi said.

According to a separate report, around 300 residents of the village of Bakau Serip protested at the entrance of Nongsa Digital Park on 5 October, carrying empty plastic bottles and jerry cans. Residents there said their household taps had been dry for three months.

The hardship has reached beyond inconvenience. In the nearby coastal village of Mata Ikan, people had to use seawater to wash after going to the toilet, said a demonstrator named Rahmat, 52. Sulastri, a 38-year-old resident, said the water crisis “has been going on for the past year, but it got worse in the last six months”. At her home, with the supply out, she poured water from a plastic bottle to wash dishes. “Many of us here run small stalls. We used to make ice cubes, but we can’t anymore.”

The government has been sending water around in tanker trucks, but Sulastri said the water was “smelly” and “yellowish”. At one protest last month, AFP journalists saw a police officer filling up buckets that residents had brought to Nongsa Digital Park.

Why did the taps run dry?

The answer depends on who you ask — and both sides may be partly right.

The local water company, Air Batam Hilir, says the area suffered a “long drought” caused by low rainfall, made worse by a strong El Niño cycle that brings dry weather to the region. Its spokesman, Ginda Alamsyah, said the drought caused the nearby Nongsa Reservoir to run very low, and supply systems were further disrupted by an electrical fault.

The mayor of Batam, Amsakar Achmad — who also heads BP Batam, the agency that oversees trade and industry on the island — said in October that the disruption “was not caused by data centres or AI or investors entering that sector”. The decline in water supply was instead “due to weather and climate factors”, he said, according to local media.

An industry source told AFP that the tech park receives its water from a different source, the Duriangkang Reservoir, not the Nongsa Reservoir that supplies nearby homes. That detail matters, because it suggests the data centres may not be drinking from the same tank as the residents.

But the residents’ anger is not only about which reservoir feeds which pipe. Batam has no natural freshwater sources. Its 1.3 million people rely on rainwater collected in six artificial reservoirs. When the rain fails, there is no backup supply. Into that fragile system, the island is now adding some of the thirstiest buildings in the world — and the amount of water the facilities actually consume is not public.

What is clear is that the authorities have moved to reduce the risk. In late September, they told developers they must build plants to desalinate seawater for cooling, so the data centres do not strain local resources. BP Batam has approved 10 data centres on the island, six of them inside Nongsa Digital Park. Two are already operating, one is under construction, and at least six more applications are under review. Total investment on the island is officially put at more than US$6.7 billion as of mid-2026.

Companies behind operational or planned data centres at Nongsa Digital Park include the Singapore-headquartered BW Digital, DayOne and Princeton Digital Group. Another owner, Hong Kong-based Gaw Capital Partners, said it was “aware of the distress and frustration expressed by local residents in Nongsa and surrounding Batam communities” over the water shortages. It said its facilities must use “advanced engineering, efficient architectural designs, and renewable energy sourcing”, including so-called “closed-loop” water systems that reuse water and need less fresh supply.

AFP contacted BP Batam and Indonesia’s ministry for economic affairs, which regulates Nongsa Digital Park, for comment. Neither responded.

What is a data centre — and why does it need so much water?

A data centre is a large building filled with rows of powerful computers called servers. These servers store information and do the calculations behind almost everything we do online: sending messages, watching videos, searching the web, and running AI tools such as chatbots.

The problem is heat. Servers working hard generate a huge amount of it, and if they get too hot they break down. So data centres need constant cooling, and the cheapest and most common way to cool them is with water. The water absorbs the heat from the servers and carries it away — in some systems it evaporates, which means it is used up and cannot be reused.

That is why a single large data centre can use millions of litres of water a day, roughly as much as a small town. In places with plenty of water, that is rarely a problem. On a small island that depends on rainfall, it can become one very quickly.

The same buildings also use enormous amounts of electricity. The power mostly comes from grids that still rely heavily on fossil fuels such as coal and gas, which adds to the climate problem. So the AI boom creates a double strain: more water and more energy, in places that may have limited amounts of both.

South-East Asia’s AI building boom

Batam is not an isolated case. It is one corner of a much bigger regional rush.

Data centre capacity in South-East Asia is projected to triple from 2025 levels by 2030, driven by a tenfold surge in AI use, according to a report by the consultancy KPMG. The pressure falls not only on water supplies but also on electricity grids that are still heavily reliant on planet-warming fossil fuels.

The construction boom in Indonesia and Malaysia began when Singapore — the region’s main tech hub — halted new data centre developments between 2019 and 2022 because of resource constraints. With Singapore closing its doors, developers looked across the strait to Batam and to Johor in Malaysia, just north of Singapore. The boom has since ramped up, boosting both countries’ economies as governments and tech giants pour hundreds of billions of dollars into training and running AI systems.

North of Singapore, Malaysia’s Johor region has become “one of the largest emerging AI infrastructure clusters in the world”, according to researcher James Chai of the ISEAS-Yusof Ishak Institute. Just half a decade ago, Johor hosted 10 megawatts of data centre capacity. That has ballooned by a factor of 200 to 2.1 gigawatts today.

The environmental cost could be high. By 2035, data centres are forecast to swallow up one-third of Malaysia’s total energy consumption, the deputy prime minister told parliament in July. The government said at that time it would only approve data centre projects after ensuring there was enough energy and water supply capacity.

Johor residents have already protested over dust pollution and flash floods linked to data centre construction, as operators build closer to residential areas. “Johor is at a critical inflection point,” Mohd Fadhil Md Din of Malaysia’s University of Technology told AFP. “It has the potential to become South-east Asia’s leading sustainable data centre hub,” but only if it manages resources and spatial planning carefully, he said.

When pushback works

Protests sometimes change the outcome. In Kota Damansara, on the outskirts of Kuala Lumpur, a plot of land intended for a data centre remains empty after local opposition. The developer withdrew its planning permission application in August, after neighbours spoke out online, lobbied their member of parliament, and gathered more than 9,000 petition signatures.

Jahaidi Harun, 72, had been concerned that the proposed data centre could be noisy and put pressure on existing infrastructure. Data centres “use a lot of water”, the retiree told AFP, adding that, as in Batam, “if the rain doesn’t come for one month, we all feel it”.

Following the withdrawal, Malaysia’s human resources minister, Ramanan Ramakrishnan, told local media he was not against “development or investment”. But “for large-scale projects that could affect the residents’ lives, the people must have a say”.

What happens next

In Batam, the immediate question is whether the water supply returns to normal — and whether the desalination order is enforced. The water company says it is trying to boost the capacity of Batam’s six reservoirs by dredging them, with cloud seeding — a technique that tries to make clouds produce more rain — as another option in dry periods.

The bigger question is whether South-East Asia can build the infrastructure for the AI age without repeating Batam’s experience in every new location. The region’s governments want the investment and the jobs. The residents of Batam, Johor and Kota Damansara want something simpler: water in their taps, power that stays on, and a say in what gets built next to their homes.

For now, the people of Batam are still waiting for both — the water, and the answer.

Frequently asked questions

Where is Batam?

Batam is an Indonesian island in the Riau Islands, just south of Singapore and connected to it by undersea cables. About 1.3 million people live there.

Why do data centres use so much water?

Their servers generate huge amounts of heat and must be cooled constantly. Water is the most common coolant, and in many systems it evaporates during cooling, so it is used up rather than recycled.

Are the data centres definitely to blame for Batam’s water shortages?

That is disputed. Residents blame the data centres, but the water company and the mayor blame a long drought, low rainfall and a strong El Niño, plus an electrical fault. The tech park is also said to draw water from a different reservoir than nearby homes. What is not disputed is that taps ran dry and residents protested.

How big is the data centre boom in South-East Asia?

Data centre capacity in the region is projected to triple from 2025 levels by 2030, according to KPMG, driven by a tenfold surge in AI use. In Malaysia’s Johor region alone, capacity has grown 200-fold in five years, from 10 megawatts to 2.1 gigawatts.

What is being done about it?

In Batam, authorities have told developers to build seawater desalination plants for cooling. In Malaysia, the government says it will only approve new data centre projects after checking there is enough energy and water supply.

Conclusion

The taps running dry in Batam tell a story much bigger than one island. Artificial intelligence feels weightless — a chatbot answering a question, a photo appearing from a few typed words — but behind every answer sits a real building, using real water and real electricity, in a real place where real people live.

South-East Asia is betting heavily on becoming the world’s AI workshop, and the investment is real: more than US$6.7 billion in Batam alone. But the protests in Batam, Johor and Kota Damansara carry the same message. Growth that leaves local people without water to cook, bathe or run a small stall is growth that will be resisted — and governments and companies that ignore that will find their projects delayed, opposed or stopped.

The AI boom needs water. The question Batam has forced into the open is whose water it will be.

Sources

• AFP via Malay Mail: https://www.malaymail.com/news/tech-gadgets/2026/11/08/as-south-east-asia-embraces-ai-data-centres-communities-question-the-environmental-cost/242434
• AFP via The Straits Times: https://www.straitstimes.com/asia/se-asia/cant-cook-or-shower-indonesians-take-aim-at-data-centres?ref=latest
• AFP via Bangkok Post: https://www.bangkokpost.com/world/3351006/cant-cook-or-shower-indonesians-take-aim-at-data-centres
• TEN10: https://ten10.my/en/news/batam-data-centres-water-backlash-desalination/

This article is for general information and education only. It is not legal or financial advice.