Indonesia Data Center Construction Market Size & Share Analysis - Growth Trends & Forecasts (2025 - 2030)

Indonesia Data Center Construction Market Trends and Insights

Cloud and AI-Led Hyperscale Investments Accelerate Facility Demand

Hyperscale cloud firms are redefining the Indonesian data center construction market by introducing AI workloads that require liquid-cooling, 40-60 kW racks, and contiguous power blocks exceeding 50 MW per campus. Tencent’s USD 500 million commitment, Nvidia’s USD 200 million GPU center with Indosat Ooredoo Hutchison, and BDx’s 500 MW renewable-powered AI campus exemplify the scale of capital flowing into. The need for immersion cooling and high-density electrical buses is stretching local contractors’ skill sets, prompting global engineering firms to form joint teams with domestic specialists. Construction schedules have tightened from an average 22 months in 2022 to 16-18 months in 2025 as land owners provide pre-approved permits and ready-built substations.^{[1]PT PLN (Persero), “Rencana Usaha Penyediaan Tenaga Listrik 2024–2033,” pln.co.id}

National Digital Indonesia Roadmap 2030 Spurs Public-Sector IT Loads

The Roadmap mandates the consolidation of ministerial IT workloads into four National Data Centers (PDN). The flagship Cikarang PDN, financed at EUR 164.68 million (USD 189.59 million), delivers 25,000 processor cores and is scheduled to begin in August 2024.^{[2]Kementerian Komunikasi dan Informatika, “Percepatan Pembangunan Pusat Data Nasional,” kominfo.go.id} Three additional PDN sites in Batam and Nusantara are in the pipeline, ensuring steady demand for Tier 4 builds over the next five years. Presidential Regulation 82/2023 requires agencies to migrate from legacy facilities, stimulating a surge of design-build contracts for secure cloud zones, zero-trust networks, and cyber-resilient plant rooms. The ramp-up has also catalysed INA DIGITAL, the new single window for public services that launched in May 2024, which now drives inter-ministerial bandwidth requirements well beyond earlier forecasts 

New International Subsea Cables Landing in Jakarta and Batam Raise Latency Standards

The Nongsa-Changi and ALPHA cable systems will bring 24 and 8 fiber pairs, respectively, lifting lit capacity and enabling round-trip latencies under 20 ms to Singapore.^{[3]Telin, “Nongsa–Changi Submarine Cable System Fact Sheet,” telin.net} Cable landing stations demand seismic-resistant buildings, redundant 24 × 7 power, and secure meet-me rooms—features that add 10-15% to base construction budgets yet enhance the investment thesis for adjacent data centers. NeutraDC’s 51 MW campus in Batam’s Kabil Integrated Industrial Estate capitalises on these new fibers, while Jakarta operators are clustering around the Ancol Landing Station to capture transit traffic. 

Edge Build-Outs in Surabaya, Medan and Makassar to Serve Tier-2 Cities

Growth in e-commerce, fintech, and provincial e-government platforms is lifting near-user compute demand. Princeton Digital Group’s multi-city rollout and Telkom Indonesia’s regional clusters shorten latency to under 10 ms for East Java and North Sumatra users. Although average project sizes remain modest at 3-5 MW, unit economics are improving as operators deploy prefabricated modules and exploit existing fibre laid under the Palapa Ring backbone.

Rising Power-Use and Carbon-Tax Exposure

Indonesia’s carbon-tax regime took effect in 2022, applying levies on emissions that exceed sector caps. Because coal still supplies 67% of PLN’s generation mix, large campuses risk material cost over-runs unless they secure renewable PPAs or on-site solar. PLN’s roadmap to net-zero by 2060 adds future price uncertainty, driving operators toward real-time power monitoring, waste-heat reuse, and demand-response programmes. Early movers such as EDGE2 now pass carbon-neutral costs through to tenants, setting a precedent for premium pricing.

Escalating Land Prices Around Jakarta CBD and Cikarang Industrial Parks

Industrial land in Bekasi and Karawang rose by double digits in 2024 as data-center buyers absorbed 72% of the supply. A premium plot near prime fibre routes can command USD 350 per m², pushing operators to evaluate Batam, Solo, and Surabaya alternatives. Sinar Mas’s 8,516 m² Menteng Atas deal, worth IDR 4.6 trillion (USD 0.28 billion), illustrates the new pricing reality. Relocating to secondary zones, however, often necessitates added capex for extra fibre laterals and longer power feeders.

Segment Analysis

By Tier Type: Tier 4 Drives Premium Growth

Tier 3 facilities account for 51.3% of the Indonesia data center construction market size, reflecting their balanced cost-to-availability ratio. Colocation providers such as NeutraDC rely on Tier 3 certifications to court enterprise tenants that demand 99.982% uptime while staying mindful of capex constraints. Tier 1 and Tier 2 sites continue to serve latency-sensitive edge nodes where modest redundancy is acceptable.

Tier 4 builds, advancing at 19.2% CAGR, are reshaping the Indonesia data center construction market as AI workloads and sovereign-cloud mandates eliminate tolerance for downtime. DCI Indonesia’s Tier IV edge facility in central Jakarta signals the march toward zero-fault architecture, with immersion cooling and compartmentalised power paths driving project costs 25-30% above Tier 3. STT GDC’s announced AI clusters will further entrench Tier 4’s position in future-ready designs.

Note: Segment shares of all individual segments available upon report purchase

By Data Center Type: Hyperscalers Reshape Market Dynamics

Colocation maintains 57.5% of 2024 revenue thanks to Indonesia’s fragmented enterprise base. Facilities such as Digital Edge’s 23 MW Jakarta site offer scalability through modular halls, securing multi-year anchor tenants that raise the utilisation curve faster than legacy carrier-hotels.

Self-build hyperscalers are registering a 20.1% CAGR, swelling the Indonesia data center construction market through 120-MW-plus campuses on 20-hectare plots. EdgeConneX’s USD 403.8 million sustainability-linked loan typifies how operators deploy green-bond structures to finance renewable-powered builds. The hyperscaler push is forcing colocation incumbents to pivot toward wholesale suites and build-to-suit models, blurring once-clear lines between multi-tenant and single-tenant strategies.

By Electrical Infrastructure: Power Distribution Innovation Accelerates

Power-backup systems—UPS arrays, diesel gensets, and battery-energy storage—held 56.3% of the Indonesian data center construction market share in 2024 because grid instability makes N+N redundancy non-negotiable. PLN’s commissioning of 41 new substations totalling 5,660 MVA in 2023 partly alleviates risk, yet operators still engineer black-start pathways and 48-hour fuel storage.

Demand for intelligent power distribution is growing at 18.7% CAGR as AI clusters swing between 10 kW and 60 kW per rack. Hitachi Energy’s digital substation pilot in East Java showcases real-time telemetry, enabling operators to shave peak loads and cut carbon-tax liabilities. The push toward software-defined power trains is fostering partnerships among switchgear OEMs, battery suppliers, and cloud analytics firms.

By Mechanical Infrastructure: Cooling Revolution Drives Server Growth

Cooling commanded 45.3% of mechanical spend in 2024. Operators are exhausting the limits of raised-floor air systems, turning to direct-to-chip liquid loops and immersion tanks that support 40-60 kW racks. Samsung C&T’s prototype underwater radiator and SMC’s HyperCube achieving <1.03 PUE signal rapid technology iteration.

Servers & storage components, growing at 19.3% CAGR, are the fastest-moving slice of the Indonesian data center construction market as AI accelerators multiply. Nortek’s StatePoint liquid-cooling integration at EDGE2 trimmed server-level energy draw by 20-30%, demonstrating how mechanical and IT-hardware decisions are converging into a single design-build scope.

Note: Segment shares of all individual segments available upon report purchase

Geography Analysis

The Indonesia data center construction market concentrates 70% of active capacity inside the Greater Jakarta conurbation, covering Jakarta, Bekasi, Cikarang, and Karawang. Jakarta’s colocation segment is projected to increase with hyperscalers occupying major of white space due to abundant fibre routes at facilities such as the Ancol Cable Landing Station. Clustering enables operators to pool skilled labour, share neutral meet-me rooms, and tap into PLN’s densest substation matrix.

Surabaya, Medan, and Makassar are tier-2 cities drawing targeted edge builds that keep latency below 20 ms for e-government and fintech transactions. Princeton Digital Group’s Surabaya deployment demonstrates how pre-fabricated 3-MW modules can be installed within nine months, a critical advantage in markets where backhaul capacity still lags Java’s backbone. Government fibre programmes under Palapa Ring have reduced connectivity barriers, yet thinner talent pools and smaller power blocks constrain the pace of hyperscale expansion.