Investment Surges as Government Tightens Oversight
Thailand's data center sector is expanding at a rapid pace on the back of global AI demand. The Board of Investment approved 26 data center projects worth 498.7 billion baht in 2025, and has already approved eight more projects worth 162 billion baht so far in 2026, according to Bangkok Biznews. The market is projected to grow from about 470 billion baht to 2.02 trillion baht by 2031, an average annual growth rate of roughly 27.7 percent, as the country positions itself as a regional hub for AI infrastructure.
To manage that growth, the government has begun tightening its rules. The BOI is now screening new projects against four criteria - electricity readiness and the transition to cleaner power, water resource management, environmental and noise controls, and concrete benefit to the country - and requiring developers to post a bank guarantee of 4.5 million baht per megawatt to prevent companies from hoarding power quotas, refundable in stages as facilities come online. Separately, the National Broadcasting and Telecommunications Commission is upgrading data center operator licences to the same tier held by telecom network providers, giving it tighter oversight of zoning, energy and water use, and the identity of data center clients, amid concerns the sector could be exploited by illicit operators for call-centre scams or money laundering.
Opposition Lawmakers Question Investment Value and Environmental Cost
Not everyone is convinced the boom is worth it. On July 29, Democrat Party deputy leader Korn Chatikavanij posted on Facebook questioning whether the 54 data center projects pending before the BOI, worth a combined 1.7 trillion baht, deliver real benefit to Thailand given how capital-intensive the industry is, how much of its machinery and technology is imported, how much profit flows back to parent companies overseas, and how few permanent jobs each project creates - typically in the hundreds to low thousands. Korn said three questions remain unanswered: whether projects filed as "warehouses" are avoiding environmental impact assessments despite using industrial-scale power and water, who will bear the cost of a new electricity tariff category being drafted specifically for data centers, and who is responsible for assessing long-term impact before and after facilities open. He pointed to South Korea, Japan, Singapore, Malaysia's Johor state, New York and the Netherlands as examples of governments that have paused or tightened data center approvals to weigh the trade-offs before resources are lost irreversibly.
A day later, on July 30, Sahassawat Kumkong, an MP from the reformist People's Party representing Chonburi - where at least 13 data centers are under construction or in planning and four are already operating - called for a new parliamentary committee to scrutinize the sector's environmental impact, according to Mongabay. "The objective should not simply be to attract investment as quickly as possible," Sahassawat said, arguing Thailand's current approach focuses too narrowly on winning projects rather than managing their consequences for water and energy resources, local communities and economic benefit-sharing. Somnuck Jongmeewasin, research director at the civil society group EEC Watch, warned that the Eastern Economic Corridor already suffers water stress and periodic blackouts, making it unlikely all approved data centers there can operate sustainably once fully online without stronger long-term planning.