What Are the Biggest Challenges in Delivering APAC Data Centres?

The biggest challenge in delivering APAC data centres is securing enough power and grid capacity. Grid constraints are now holding back projects across many established markets, influencing where developers build and how quickly capacity can come online. Alongside this, equipment shortages, skills gaps, complex national regulations, sustainability obligations and rising costs are creating more pressure. These issues are closely connected, with workforce availability often holding back progress in power, procurement, compliance, and operations. Developers who plan for these constraints early, particularly for specialist talent, are more likely to avoid costly delays.

Key Takeaways:

• APAC data centre investment hit a record US$11.6 billion in 2025, with 32 GW of planned capacity across 1,150+ projects. Much of this investment is being directed towards hyperscale data centre construction, as cloud providers expand capacity to support AI-driven demand.
• Power and grid access have overtaken land, finance and permitting as the biggest limitations on project delivery, pushing some builds towards secondary hubs like Johor and Melbourne.
• Supply chain pressures have extended equipment lead times, making early procurement planning essential.
• Nearly two-thirds of operators have struggled to find or retain qualified talent.
• Rising construction costs and sustainability demands strengthen the case for early workforce planning and talent mapping.

Asia-Pacific has become one of the busiest construction sites on the planet for data centre infrastructure. It is a key region for global hyperscale demand growth (14% annually), with technology firms planning to increase global capital expenditure by 61% in 2026 alone.

More specifically, APAC data centre investment hit a record US$11.6 billion in 2025, as capital moved beyond Singapore and Hong Kong towards Malaysia, Australia and India. Eventually, this will produce more than 32 GW of planned data centre capacity across more than 1,150 projects in the region. 

China’s demand for data centre capacity is forecast to grow at 20% between 2025 and 2028, driven by large language model developers and hyperscaler spending. India, Japan and the Philippines are also expected to be key growth markets, due to factors such as favourable demographics, deep engineering talent, proximity to the Middle East, government initiatives and streamlined approvals. 

For companies running these projects, there are numerous obstacles that need to be overcome: power, supply chains, people, regulation, sustainability and cost. These pressures affect not just whether an AI data centre gets planned in the first place, but also how quickly wider AI infrastructure can be delivered across the region.

Power and Grid Constraints: The Defining Bottleneck

Power and grid availability are rapidly becoming the main constraints on APAC data centre growth, overtaking issues around land, finance and permitting. Many established markets do not have sufficient electricity capacity to support new facilities. As demand for AI infrastructure increases, developers are increasingly looking towards secondary locations with greater power availability.

Some markets, including Japan, are exploring frameworks that let facilities connect before grid reinforcement is finished, provided that operators install battery storage or load-shedding technology. Even so, infrastructure bottlenecks are already delaying major Japanese data centre and chip foundry projects until 2029, despite billions of dollars in investment.

This is prompting operators to look beyond saturated primary markets. In 2025, Johor (Malaysia) recorded 53% year-on-year growth in live capacity, along with around 37% growth in Melbourne, as developers sought secondary hubs with more available power. 

Why Supply Chain Delays Are Slowing APAC Data Centre Projects

The APAC data centre sector suffers from “extreme system interdependence” where “even minor coordination failures can cascade into significant programme delay or operational performance risk.” Mechanical, electrical and digital systems must all come together on compressed programmes, with little tolerance for delay in any one component. 

Unfortunately, international and regional supply chains are struggling to keep up with this rate of sustained growth.

Global shipping disruption and the subsequent freight uncertainty have had a huge impact. For example, following the Middle East conflict, Maersk rerouted vessels around the Cape of Good Hope, adding 8–15 days to transit times between Asia and Europe. 

As a result of geopolitical tensions and limited supplier capacity, long lead equipment has become a major problem for APAC data centre delivery. The availability of key equipment such as generators, switchgear and transformers can now dictate an entire schedule before construction even begins.

Impacts are also being seen in key commodity prices: copper prices across APAC rose by 9–18% quarter-on-quarter in Q1 2026.

So, the procurement strategy now needs to be locked in well before design is finalised.

The Data Centre Skills Shortage

Even where power and equipment are secured, projects still depend on people, but they are increasingly hard to find. In 2025, a survey by the Uptime Institute found that nearly two-thirds of data centre operators reported difficulty finding or retaining qualified talent. 

The data centre jobs in shortest supply include high-voltage electrical engineers, mechanical and commissioning specialists, and operations staff who understand mission-critical data centre infrastructure. Alongside booming demand for such roles, conventional training for these skills has not kept pace with the scale of data centre projects now underway. As a consequence, operators are now launching their own training programmes, but it will take several years before the effects are widely felt.

Competition for this talent comes from several directions at once. Hyperscalers, colocation providers, power utilities and adjacent infrastructure sectors are all recruiting from the same limited pool, and poaching between operators is common. Every vacant role carries a direct line to project delivery risk and, once a facility is live, to operational continuity.

Differences in Regulation and Data Sovereignty

Companies that are building across several APAC markets face rules that vary sharply by country. 

For example, China’s Personal Information Protection Law (PIPL) places heavy emphasis on data sovereignty and localisation. Vietnam’s Cybersecurity Law and Decree 13/23 impose another of the strictest localisation regimes in the region, requiring providers to store certain data within the country. 

By contrast, Singapore and Japan take a more flexible approach to cross-border transfers with much less onerous restrictions. As a consequence, these countries are developing closer ties with the European Union and they are seeing the development of APAC data hubs operating between Asia and Europe.

The regulatory differences also run much deeper than just for data transfers. Permitting timelines and foreign-ownership rules, for example, can look entirely different from one market to the next. So, understanding these local disparities is becoming as important as the technical build itself.

Sustainability in the Age of AI Data Centres

Like many other sectors across the world, APAC’s growth is coming up against climate commitments. 

The region’s data centre energy consumption is expected to increase by up to five-fold by the mid-2030s. But currently, coal accounts for 49% of APAC’s total energy supply, followed by oil (23%), gas (11%) and nuclear (3%). Biofuels, renewables and hydropower together make up only 13.5% of the total. 

Clearly, something has to change. Developers are responding with long-term renewable power purchase agreements, on-site storage and “clean energy data zones”, these are clusters of data centres built near strong solar and wind resources to avoid costly grid upgrades. 

The industry itself is also taking action to reinforce this shift. The Asia Pacific Data Centre Association (APDCA) recently launched the Sustainable Digital Infrastructure Accord (SDIA). This is a regional framework of sustainability commitments for the data centre sector, covering energy efficiency, clean energy use, water use and circular economy. Together, these initiatives reflect the growing importance of data centres as strategic digital infrastructure supporting cloud computing, AI and economic growth.

Why APAC Data Centre Construction Costs Are Increasing

Build costs vary enormously depending on where in APAC a project is located. For example, costs per megawatt vary between US$7.9 million in Taiwan and US$19.2 million in Japan.

Construction cost inflation is just as uneven, too. Singapore saw costs increase by 22.7% in 2025/26, followed by Japan at 20.9%, compared with just 1.7% in both China and Taiwan.

Land scarcity adds a further layer of difficulty in mature markets. Singapore and Hong Kong have some of the highest land costs in the region, pushing operators towards secondary locations. 

Combined with rising labour costs and greater capital requirements for AI-optimised designs, developers are now having to model far more carefully before committing capital.

Workforce Planning: The Common Thread

Looking closely at each of these challenges, a pattern emerges. 

Power expansion depends on engineers who understand grid integration. Supply chain resilience depends on experienced procurements specialists who can anticipate bottlenecks. Regulatory compliance depends on people who understand local laws, not just global policy. Meeting sustainability commitments depends on specialists in renewable integration and energy efficiency.

This is why workforce planning deserves as much focus as anything else during the development of a data centre. Talent mapping – identifying where specific skills exist across the region ahead of the recruitment stage – allows developers to plan hiring around construction phases, rather than simply reacting to shortages when they appear. 

Workforce forecasting and international mobility give project teams the flexibility to move skilled people to where they are needed most, whether that is a hyperscale build in Johor or a colocation expansion in Melbourne.

At NES Fircroft, we have built our business around exactly this problem, working with data centre developers, contractors and operators across APAC to ensure that a project’s workforce moves in step with technical and commercial planning.

How NES Fircroft Supports Data Centre Projects Across APAC

We have delivered data centre recruitment across APAC since 2008, combining global reach with local expertise through 29 regional offices and a wider network of more than 80 locations worldwide. That local presence matters when every market, from Vietnam’s localisation rules to Australia’s grid connection process, works differently.

Our teams support every phase of a project, including design and construction, commissioning, and day-to-day operations, through permanent hires, contract staffing, Employer of Record (EOR) services, managed workforce solutions and global mobility. We maintain access to a highly mobile pool of specialist talent, ready to relocate nationally or internationally to meet project milestones. 

Our proactive talent mapping means we have access to niche, hard-to-find skills that are essential for large‑scale data centre builds, backed by consultants who can advise on workforce strategy from the earliest stages of a project.

If you need support with data centre recruitment in Asia or Australia, please contact our specialist team to find out how we can help.

People also ask:

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Workforce solutions include expanding talent pools through skills-based hiring, cross-border mobility and phased workforce planning. Long-term approaches such as retention initiatives, internal development and industry-led training also help build the specialist expertise needed for future operations. Learn more about data centre skills, hiring trends and workforce challenges in APAC.