Data centers and water tensions in Indonesia ^{CEFR B2}

Rapid AI expansion is driving strong demand for data centers across Indonesia, and the country is expected to capture significant economic value from generative AI. Analysts estimate USD 243.5 billion in economic production capacity, about 18 percent of Indonesia’s 2022 GDP. As of April 2026 there are 170 data centers nationwide. Firms and policymakers are racing to add capacity and the supporting infrastructure needed for an AI-ready economy.

Water use has emerged as a major constraint. Industry estimates show a medium-sized data center consumes about 300,000 gallons per day (110 million gallons per year), roughly the annual use of 1,000 households. Nearly half of Indonesia’s data centers are in hot locations, where heavy cooling demand can reduce public water availability. In 2025 the Media Monitoring Repository on AI Incidents in Indonesia recorded six incidents involving data centers, including database leaks, performance failures and high energy use.

Batam highlights the trade-offs. The Batam Industrial Complex already hosts 18 data centers. At Kabil Industrial Park new sites would need 56 megawatts and up to 3 million liters of water per day for cooling, enough for about 30,000 people. The nine proposed data centers in Nongsa Digital Park would need 285 megawatts and around 29 million liters per day. Together, existing and planned facilities could consume around eight percent of Batam’s water supply, prompting community protests in September and December 2024 and calls for careful planning and sustainable water management.

• Marketing messages claim Batam can use renewable energy and strict rules to grow sustainably.
• Residents of Teluk Mata Ikan demonstrated over shortages; authorities blamed a "technical glitch" for disrupted distribution.
• Local voices warned of environmental injustice, asking governments and companies to balance industrial expansion with basic water needs.