France-headquartered energy producer TotalEnergies has signed a power purchase deal with Google to supply one terawatt hour (TWh) of solar energy to the technology giant’s Malaysian data centres for 21 years.
The renewable energy will come from an upcoming 29.99-megawatt (MW) Citra Energies solar farm in the northern Peninsular Malaysian state of Kedah, TotalEnergies said in a press statement on Tuesday.
Construction of the plant will begin in 2026, more than two years after the project was awarded by Malaysia’s Energy Commission to a joint venture between local real estate developer MK Land (51 per cent stake) and TotalEnergies (49 per cent stake) in May 2023.
The engineering, procurement, construction and commissioning work on the Citra Energies plant will be carried out by Atlantic Blue, a subsidiary of Malaysian public-listed renewable energy firm Solarvest that has been commissioned by MK Land and TotalEnergies.
“The power purchase agreement [between TotalEnergies and Google] will take effect upon the project’s financial close, expected in the first quarter of 2026,” TotalEnergies said.
The 21-year agreement follows a similar deal between the two companies inked last month, under which TotalEnergies will supply 1.5TWh to Google’s data centres in the United States from the former’s Montpelier solar farm in Ohio.
Separately, Google had earlier signed an agreement with Japan-based Shizen Energy Group in Malaysia to purchase more solar power from the latter’s plant farm in Kedah, which will also have a capacity of 29.99MW and is scheduled for completion in 2027.
Both Shizen’s project and the Citra Energies plant are being developed under Malaysia’s Corporate Green Power Programme, a scheme launched in May 2023 that enables corporate power purchasers to invest in new renewable energy projects through virtual power purchase agreements.
The CGPP has since been succeeded by the Corporate Renewable Energy Supply Scheme (CRESS), which allows third-party access to Malaysia’s electricity grid for renewable energy producers and businesses.
‘Carbon-free energy’
The expansion in Google’s Southeast Asian data centres comes as the regional market for artificial intelligence is projected to top US$8.9 billion. However, the environmental and climate impacts of energy-intensive, water-guzzling data centres has also raised concerns.
Last month, Malaysia’s southern state of Johor said that it would no longer approve the construction of data centres that use more than 200,000 litres of water a day, typically used for cooling.
In May this year, Google’s Asia Pacific head of sustainability Spencer Low said that the firm’s regional expansion of data centres depends on where it can secure a pathway to “100 per cent carbon-free energy”.
He added that many tech giants are prioritising additionality, which means that they would be adding new renewable energy to the grid instead of drawing from existing sources, Eco-Business reported.
In October last year, Google said it would be investing US$3 billion in new data centres in Thailand and Malaysia, adding to its existing sole operational data centre in Southeast Asia, located in Singapore.
Meanwhile, oil and gas-heavy TotalEnergies, which recently had its advertisements declared illegal for greenwashing in its home country, has been growing its renewables energy business with the aim of producing 120TWh in solar and wind power by 2030.
However, TotalEnergies chief executive Patrick Pouyanne has expressed confidence that market demand for oil would rise, though not for liquified natural gas (LNG). In a recent interview with Bloomberg, he said the company plans to enter into more long-term LNG contracts with Asian buyers.
TotalEnergies has been expanding its footprint in Malaysia’s oil and gas industry in recent years, particularly offshore Sarawak in Malaysian Borneo. In June this year, it partnered with national oil company Petronas to develop offshore gas fields in Malaysia and Indonesia. Last year, TotalEnergies acquired Malaysian upstream producer SapuraOMV, which operates several gas fields in Sarawak.
