2 SEP 2026 — Nikkei reported on 2 September that data-centre opposition has spread across Asia, from Moss Vale in New South Wales to India. The region's first protest was in Johor in February, and the facility those residents stood outside uses reclaimed water at about 200,000 litres a day. Their complaint was dust, not water.
What happened at Gelang Patah
More than 50 people gathered outside a data-centre construction site in Gelang Patah, Johor, in February, representing close to 1,000 residents across four housing estates. They demanded an end to dust pollution and compensation for any health effects. The site sits less than a kilometre from the nearest homes.
The project is being developed for China's ZData Technologies through its subsidiary Computility Technology Sdn Bhd, on 15.4 hectares of a 40.5-hectare area bought from Tropicana Firstwide. It had already received a stop-work order in late 2025 for breaching requirements, and environmental conditions require a 150-metre buffer from homes.
Computility director Yeo Yong Hwang said the site would not use municipal water and would rely entirely on reclaimed water, so there would be no competition with residents' supply, and that hydroseeding is carried out along the access roads once an hour. Kota Iskandar assemblyman Pandak Ahmad confirmed council monitoring and daily developer reports.
Two different arguments are being run as one
Water is the argument that travels, and it is a real one at the level of state policy. Johor stopped approving Tier 1 and Tier 2 facilities, which can draw up to 50 million litres a day, nearly 200 times what a smaller operation uses.
The Gelang Patah facility is Tier 3+, in the category that typically uses around 200,000 litres a day, on reclaimed water. The site's design does not create a water dispute. The operator's claim to use reclaimed water is verifiable rather than rhetorical.
What the residents actually raised was dust, air quality and proximity — the ordinary complaints about any large construction project a few hundred metres from a housing estate. Those complaints are also the ones a state can act on quickly, which the stop-work order shows.
Reclaimed water is a real answer with a real limit
Committing to reclaimed water rather than municipal supply is a verifiable undertaking, so the promise can be taken at face value. A facility plumbed to a reclamation plant cannot quietly draw from the treated supply without a metered connection somebody can inspect.
Reclaimed water is not an unlimited resource, however. It comes from a treatment works with its own capacity, and a large industrial offtaker changes what is available for the other uses that water was earmarked for, including agriculture and industrial customers already connected.
So the honest form of the commitment is narrower than it sounds. It removes the facility from competition for drinking water, which is the thing residents were worried about, and it does not remove it from the state's overall water balance. Johor's approvals process now asks about the second question as well as the first.
The policy response was faster than the protest
Weeks after Gelang Patah, Prime Minister Anwar Ibrahim announced that new applications for data centres unrelated to AI had been stopped. Johor had already halted Tier 1 and Tier 2 approvals, tightened the criteria for water applications, and imposed a requirement that operators use at least 85 per cent of the power they declared within their first four years.
That last rule is the most interesting and the least discussed. A developer securing a grid connection much larger than it intends to use is reserving scarce capacity against a future it may never build, which blocks the queue for everyone behind it. Requiring 85 per cent utilisation makes over-declaring expensive.
It is also a lever no amount of community opposition would have produced, because residents do not argue about interconnection queues. It came from the state discovering that its grid was being booked faster than it was being used.
A correction to something we wrote
We reported two days ago on the health cost of on-site gas turbines at American data centres, and argued that the organised advocacy layer had not yet reached this region, arriving in the United States only once local objections started winning.
The sequence here ran the other way. Johor's objections arrived in February 2026, produced a stop-work order and a state moratorium within weeks, and no funded advocacy campaign appeared on either side. Malaysian policy moved faster than American policy has, without the advertising.
The likely reason is structural rather than cultural. Data-centre approval in Johor runs through state authorities with direct control over land, water allocation and power, so a decision can be taken at one level of government. In the United States the same questions are split across county zoning, state utility regulators and federal energy policy, which is precisely the fragmentation that makes a public-opinion campaign worth funding.
What this means for the projects still coming
Johor and Batam continue to attract the region's largest data-centre investment, and the constraint is now written into the approval process rather than argued afterwards. An operator planning here needs a water answer, a power-utilisation answer and a proximity answer before it applies, not after residents organise.
The proximity number is the one to plan around. A 150-metre buffer is a minimum, and a site less than a kilometre from housing will generate complaints throughout construction whatever its cooling design. Dust and lorries are visible; water abstraction is not.
We reported that the Johor-Singapore Special Economic Zone is being built around data-centre and AI infrastructure investment. The zone's constraint is no longer capital or land. It is the few hundred metres between a construction hoarding and somebody's kitchen window.
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