‘Philippine’s data center push faces power reality check’

MANILA, Philippines — The Philippines has the potential to emerge as a regional data center hub, but its next challenge is ensuring that reliable, affordable power can keep pace with surging digital demand.

For Eaton Philippines, a global intelligent power management company, electricity cost and reliability remain crucial factors shaping investment decisions in the country’s hyperscale industry.

“Investors need to know that power is stable, available and competitively priced — and increasingly, they’re also looking at access to renewable energy,” Eaton Philippines country manager Pamela Albar told The STAR in an interview.

As the data center race becomes a power race, Albar said the Philippines’ ability to scale infrastructure quickly will determine whether it can capture the next wave of digital growth.

Without sufficient power infrastructure to support rising demand, the country risks falling behind its Southeast Asian peers.

“We need to be thinking about how to build faster, but also smarter — whether that’s through more flexible power solutions, modular deployment or strengthening grid resilience,” Albar stressed.

This challenge is becoming more urgent as the rise of artificial intelligence fuels demand for data centers, which require mammoth amounts of electricity to run servers, cooling systems and other critical facilities around the clock.

For the Philippines, where power reliability has long been a concern, frequent outages could become a red flag for data center developers seeking stable and dependable operations.

Adding to the challenge is the country’s high electricity cost. In 2024, the Philippines ranked second only to Singapore in the region in terms of power rates, according to data firm Global Petrol Prices.

But beyond power cost and supply concerns, Albar noted that the country also needs better alignment across infrastructure development.

She said generation, transmission and data center developments often move on separate timelines, creating delays that could slow the pace of expansion.

“What would make a big difference is more coordinated planning, where power generation, grid upgrades and site development happen in parallel instead of one after the other,” Albar said.

Further, the Eaton official emphasized that developing a stronger local talent pool would be critical for the Philippines to stay competitive in the data center space.

“Overall, we’re moving in the right direction, but the focus now should be on readiness, speed and ensuring we remain competitive as demand continues to grow,” Albar said.