Conferences for Emerging Markets and Technologies

Asia’s AI Boom Highlights Urgent Need for Reliable Power

Surging Semiconductor Demand Raises Stakes for Energy Security and Baseload Solutions

4 months ago 2 min read

TSMC’s record-breaking Q2 earnings underscore a growing dilemma: AI’s explosive growth is outpacing Asia’s power capacity. With HPC now driving over 60% of TSMC revenue, the region’s ability to deliver uninterrupted, low-carbon electricity is becoming a defining factor in AI competitiveness.

Asia’s rapid expansion in artificial intelligence (AI) and high-performance computing (HPC) is revealing a critical gap: stable, scalable, and sustainable energy supply. A recent earnings report from Taiwan Semiconductor Manufacturing Company (TSMC), the world’s leading chipmaker, underscores how AI-driven growth is translating into extraordinary electricity demands.

TSMC’s second-quarter earnings, released July 17, showed a 44.4% year-over-year revenue increase to USD 30.07 billion, with net profit rising by 60.7%. The surge was largely attributed to growing demand in the AI and HPC sectors. HPC alone grew 14% quarter-over-quarter and now contributes 60% of TSMC’s total revenue. Goldman Sachs raised its TSMC price target on June 25, citing stronger-than-expected AI demand and longer-term earnings growth through 2027.

The energy implications are significant. AI data centers require high-density, round-the-clock electricity to operate effectively. In Southeast Asia, this has triggered broader concerns about grid reliability and the need for firm, low-carbon baseload power. A recent McKinsey report projects global data center infrastructure investment will reach USD 6.7 trillion by 2030. In parallel, Malaysia’s AI-linked power demand is forecast to climb from 9 TWh in 2024 to 68 TWh by 2030 – nearly 30% of its projected national consumption.

Energy experts and industry stakeholders argue that nuclear power, particularly in the form of Small Modular Reactors (SMRs), is one of the few viable solutions to meeting such demand sustainably. The challenge now lies in regulatory readiness, capital deployment, and regional coordination. Organizers of the upcoming Nuclear Power Forum Asia 2025, co-located as part of AI Week Asia 2025, point to the current moment as a pivotal one: “The question is no longer if nations need resilient power for AI and manufacturing – but how quickly they can build it.”

Without long-term baseload solutions, Southeast Asian economies risk missing out on hosting AI clusters and green industrial investments, particularly in semiconductors and data centers. As digital infrastructure becomes central to national competitiveness, the conversation around energy security is increasingly overlapping with clean energy investment strategy.