Digital Infrastructure Bill

Debate resumed.

Mr Speaker: Ms Poh Li San.

6.43 pm

Ms Poh Li San (Sembawang West): Mr Speaker, data centres are not just critical infrastructure but have become a political flashpoint across the world. They require hard conversations about the trade-offs and policy choices. Building data centres is not a design problem. It is a competition among political values.

First, AI is driving the transformation of Singapore economy, and a robust data centre infrastructure is the foundation for our computing power. However, these centres take up land, water, power and create a ton of electronic waste. Some harmful impact on environment can be minimised by regulation, but they cannot be completely neutralised. We must weigh these costs carefully.

Data centres also open up new points of fragility. They are a single source of national level failure either due to technical, operational glitches or targets of cybersecurity attacks. From Ukraine to the Persian Gulf, data centres have been targets of espionage and cyberattacks, as well as physical attacks. The rise in use of AI makes these centres more vital than ever.

This second issue of security also requires careful scrutiny. With so many critical functions dependent on data centres, their security and resilience levels must be kept state-of-the-art. This will not come cheap. The higher cost will in turn mean that Singapore-based data centres are necessarily priced higher. They should also go towards those activities most critical to our country. Examples are power generation, telecommunications, finance, business and transport. These functions, which require a lower threshold of security or which are less crucial, such as entertainment and social media, service providers can choose cheaper and less fortified data centres outside Singapore.

It was not so long ago that we put a stop to unbridled growth of data centes. A moratorium on data centres was imposed in 2019 to manage the unsustainable consumption of electricity. It was only lifted in 2022 under strict sustainability requirements. Notwithstanding, it still did not address the security and resilience aspect for data centres. Hence, this Digital Infrastructure Bill is timely, as we scale up our national AI ambitions.

In fact, in Senior Minister of State Tan Kiat How's response to my supplementary question during the September Sitting, he highlighted that the Government will maximise the economic value of every megawatt brought into Singapore. We want both growth and sustainability. With his assurance, I support the Digital Infrastructure Bill and agree this is the correct and comprehensive approach to regulate data centres.

Given our limited land, water and electricity resources and our commitment towards Net Zero by 2050, we will have to put a cap to our total data centre capacity. Currently, we have 1.6 gigawatts on mainland and the Government will build another 700 megawatts in Jurong Island. That brings the total of 2.3 gigawatts for some 6.2 million population or 370 watts per capita. This is more than double the average of 158 watts per capita in the US.

We also have a big concentration of IT, AI, social media, e-commerce and banking companies. They will use high volumes of compute power. Moreover, quantum computing will enter mainstream use in another three to five years, further adding the demand for data centres and potentially in an exponential manner. So, my question is, will the 2.3-gigawatt data centre capacity be enough? If not, what will we do and what is the trade-off?

Mr Speaker, I had earlier pointed out the need to prioritise critical functions. The Digital Infrastructure Bill does not categorically prescribe what are the functions that can be allowed to tap into data centres housed in Singapore. I ask for the Ministry to consider including this prioritisation criteria at the start in terms of usage allocation. Otherwise, we may come to a point where critical functions may be crowded out of data centres access because less critical but more lucrative functions can pay better.

We cannot and must not rely on the price mechanism to protect national security. My question is that if that situation happens, do we then force these non-critical functions out to overseas data centres or use cloud services off overseas data centres? Or do we continue to build more data centres beyond the 2.3-gigawatt capacity? Then we run up against our Net Zero goal. What industries then must make way for more data centres? What happens to the livelihoods of those in these industries that may be less lucrative?

These questions may sound far into the future now, but as we have seen in recent years, time is moving at a speed faster than it did. For our long-term policy planning, we should think about such possibilities. Mr Speaker, notwithstanding my reservations, I support the Digital Infrastructure Bill.

Mr Speaker: Ms Eileen Chong.

6.49 pm

Ms Eileen Chong Pei Shan (Non-Constituency Member): Mr Speaker, most Singaporeans have never been inside a data centre. But when we scan a payment QR code, access services via Singpass, or video-call a loved one overseas, we are relying on one.

Data centres are the physical backbone of the modern digital world, powering our daily activities, essential services and our economy. We tend to only notice them when something goes wrong. And things do go wrong.

In October 2023, technical issues with the cooling system at a data centre during a planned upgrade disrupted Singaporeans' access to banking services. While the outage lasted less than 24 hours, its impact was significant – more than 2.5 million payments and ATM transactions could not be completed, and there were over 810,000 failed attempts to access digital banking platforms. In September 2024, it took Singapore Singapore Civil Defence Force (SCDF) two days to complete the damping down operations following a fire in a battery room at a Loyang data centre.

Neither incidents involved a cyberattack. It was the physical infrastructure that failed.

We have a Cybersecurity Act that deals with actors who mean harm to our digital infrastrcuture. But it does not deal with a cooling system that malfunctions, a battery that catches fire, or a power supply that fails. It is thus timely to introduce legislation that addresses these non-cyber risks which also affect the security and resilience of major data centres and cloud service providers.

The Bill also takes an equally important step on sustainability, by placing the resource efficiency of data centres on a statutory footing. My colleagues have earlier set out what is at stake in that respect: our power, our water, our land and the communities beyond our shores who absorb what we displace. I share those concerns and I will not repeat them.

I would instead like to focus on asking: once we accept that that trade-offs must be weighed, who weighs them, against what and how would Singaporeans know?

Almost every substantive requirement in this Bill will be prescribed later, in regulations and Codes of Practice. While this preserves flexibility and ensures that the requirements keep pace with technological developments, it also means that those details will not come before this House at subsequent readings of this Bill. So, even as I support the Bill, I would also appreciate the Senior Minister of State's clarifications about how it will work in practice.

Operators in this sector are not lightly regulated today. They already answer to the Building and Construction Authority (BCA) for the Green Mark, to PUB for water efficiency plans, to SCDF for fire safety and to their own customers for a stack of international certifications. This Bill adds a new licence on top. My clarifications today are about how the Bill will add to, rather than compete with, what already exists.

First, on the licensing itself. Will the application, audit, annual report and the renewal of the license be designed as a single streamlined process, with one form and one set of supporting documents? Will information an operator that has already given to IMDA under one limb be carried across, rather than requested again under another?

Second and more substantially, on harmonising with what already exists. Operators today already navigate a wide spread of credentials. Some carry legal force through the building regime. Some are national standards. Some are voluntary international frameworks to meet customer demands. I note that the draft Bill gives IMDA the tools to recognise these credentials: clause 67(3) allows different provisions for different classes of operators; clause 69 allows regulations to incorporate external standards by reference.

Sir, I have four clarifications for the Senior Minister of State.

First, will the subsidiary legislation provide that holding a valid, accredited certification, such as a BCA-IMDA Green Mark Gold Plus or Platinum rating for Data Centres, or SS 564, creates a rebuttable presumption of compliance with the clause 35 requirements?

Second, will an audit report produced for an accredited framework, such as ISO 50001 or Green Mark, within the preceding 12 months or 24 months be accepted towards the annual reporting and audit obligation under clause 36? An operator should not have to be audited on the same data twice, in the same year, for two different regulators.

And third, will the Ministry use clause 67(3) to set a lighter reporting route for smaller and single tenant facilities, reserving full third party statutory audits for the larger ones: say those, perhaps, at 10 megawatts and above? While hyper-scalers easily absorb extra audit overheads, mid-tier local operators should not have to choose between paying for an audit and funding the physical equipment upgrades that the audit recommends.

And fourth, will IMDA's verification protocols be aligned with existing accreditation bodies, such as the Singapore Accreditation Council-accredited certification bodies, so that we are not building a parallel audit profession to check work that has already been checked?

Third, on non-cyber risks that are not regulated by IMDA alone. Fire safety sits with SCDF under the Fire Safety Act. Building standards sit with BCA. Water efficiency sits with PUB. These agencies all answer to different parent Ministries and I am not suggesting that IMDA take over any of their functions. But this Bill does give IMDA a new instrument – licence conditions. An operator will read the licence conditions as the authoritative statement of what is expected of it.

So, I would be grateful if the Senior Minister of State can confirm that these conditions for the license, most of which will be laid out in subsidiary legislation, will be settled amongst the relevant agencies before they are issued, so that operators work to meet one set of coherent conditions rather than having to reconcile three or more sets of expectations.

I ask as this because there will be times where these requirements might pull against one another, and there should be clarity on how that will be resolved. I would like to illustrate this with the fire at the Loyang data centre in September 2024. The batteries involved were lithium ion. It is the same technology that our green energy policy encourages data centres to adopt, because it helps them store renewable power and ride through power outages.

And when the fire in the Loyang Data Centre started, the sprinklers did what they were designed to do: sprinkle water. This, plus water spraying from the SCDF's firefighting operations subsequently led to the server room experiencing water accumulation and leaks, resulting in heightened risk of electrical short circuits. This led to a decision for an emergency power shutdown, which further disrupted service provision.

I cite this example to illustrate how the measure that protects the building may not be the same measure which protects the service. While I am in no position to say which should yield to the other, if at all, an operator designing a battery room should get a clear, single non-conflicting answer about what is expected.

Another example is what is written into clause 25(2)(b) of the Bill, which requires IMDA to have regard to both energy efficiency and water efficiency. While next-generation liquid cooling promises to optimise both, legacy air-cooled facilities that are retrofitting their systems will face operational friction. Traditional evaporative cooling towers shed heat efficiently to save power, but consume heavy volumes of water. Dialling back water use without immediate capital upgrades can then drive energy consumption up.

So, this Bill names both statutory duties, but offers little clarity on how IMDA will weigh energy versus water metrics during license evaluations for legacy facilities. So, I have three clarifications in this regard.

First, where the requirements pull against one another, whether within the criteria set out in clause 25, or with requirements of other agencies, what will guide IMDA's decision in striking a balance? Can the Senior Minister of State share an example of how such tension would be resolved in practice?

Second, will compliance with the new licence conditions be taken as satisfying, or at least, as aligned with, the baseline expectations of the consulting agencies, so that an operator which has already met its license requirements is not later told by another agency that it has fallen short of something else?

And third, will the Codes of Practice under clauses 16 and 37 draw on the lessons of past incidents, including standards for lithium ion battery storage safety, redundant cooling switchover and physical isolation between plant rooms?

Mr Speaker, these are questions about implementation rather than intent of the Bill. No serious operator or service provider would object to being held to a standard. But what would wear them down is being held to varying standards that have not been reconciled. Clarity is not a concession to business, it is the condition on which compliance will happen. Notwithstanding my clarification, Sir, I support the Bill.

Mr Speaker: Dr Neo Kok Beng.

6.59 pm

Dr Neo Kok Beng (Nominated Member): Mr Speaker, Sir, I welcome and support the Digital Infrastructure Bill. Digital infrastructure is foundational to Singapore's economy and society. I intend to keep my speech short and therefore, there are five areas of concerns for the Ministry to consider or clarify.

The first area is the licence types, grants and a renewal duration. The Bill states two categories: foundation digital infrastructure that is 10 megawatts or above; and a data centre that is between three and 20 megawatts. Can the Senior Minister of State clarify that if a foundation digital infrastructure requires two licences, and if so, if it is possible for an foundation digital infrastructure to submit using one licence rather than have a duplication, or if there are other concerns which result in two applications of licences?

The second area is the change of control. Clause 30 defines a change of "5% controller" to be notified within seven days. We know that the equity structures of data centres could be cross-holdings and could be many possible options, where people invest with different equity structures. So, there might be situations where equity engagements might be complex due to different crossholdings. Can the notification period be extended by the licensee through formal request rather than the strict seven days?

One important issue is the Code of Practice. The Bill mandates heavy penalties, up to $1 million or 10% of the annual total turnover for non-compliance with the Code of Practice. While that is good, however, under section 14, IMDA will issue the Code of Practice subsequently.

The industry licensees, the operators and engineers are being asked to navigate in this architecture where the destination is very clear, we need to regulate and have the licence, but the Code of Practice is not clear, because it is only going to come soon. So, the Code of Practice defines the precise performance standards, which is a work in progress.

I would like to request more clarity into the composition of the panel that defines the Code of Practice. Does it include representation from the industry, besides the authority? How will the industry's perspectives and viewpoints be included?

Area four of concern is balancing sustainability with innovation. The Bill introduces the Data Centre Operator Licence for facilities of three megawatts and above. To enforce environmental sustainability, we know that our green electricity is currently in short supply. However, we cannot allow the code of practice to be so rigid such that we cannot move for the current operators.

Moving PUE from 1.3 to a strict 1.25 creates big obligation for at least the current operators to invest in their current legacy facilities. I think this needs to be taken into consideration, and taking the equipment's amortisation lifetimes and usage lifetime into concern, rather than fix it very tightly in a certain regulatory period.

If done too quickly, the rush to hit these sustainability metrics could threaten the very operational resiliences we are trying to protect.

We do have new standards that we pioneer on liquid-to-air cooling prototype based on Singapore Standards SS726 for high-density AI clusters. Well, air cools. So, lesser water, no water, this will spike the PUE. And maybe a balance between the PUE and the water usage effectiveness might be considered in this case. This can be considered in a "sandbox" way that we can balance and experiment what are the good usage of innovations and technology.

Our Code of Practice must be there for dynamic, outcomes-based and adaptive to the physical realities of developing technologies.

The last area is area five – the professional framework for technicians, engineers and technologists involved in digital infrastructure. We can build the most secure, greenest digital fortresses in the world, but we still need the people to operate it.

These high-performance data centres of today are no longer simple real estates with just things like racks and servers being plugged in, with heavy air-conditioning systems. They are hyper-complex, mission-critical infrastructure combining advanced power telemetry, mechanical engineering, AI workload distribution and cybersecurity. If we are thinking of structural resilience as a legal mandate, we must therefore treat the competencies of our engineering workforce as a regulated, strategic national priority.

To achieve this, we should not just upskill the top tier, the engineering group, but also the technician or the operations unit. I note that the Institute of Technical Education also has certificates, or Nitec and Work-Study Diplomas that are related to data centre operations. We should create a register for the entire engineering stack – from technician, technologists or engineers to internationally recognised professional standards.

I highly recommend that we start exploring skills accreditation for chartered engineering status and registry for digital infrastructure engineers, technologists and technicians.

In light of that, would the Ministry support the development of a Singapore Data Centre Body of Knowledge which will consolidate all the knowledge and experiences of the industry, including the various Singapore Standards such as the SS564, the sustainable data centre; SS697, tropical data centre standards; SS715, energy efficiency of data centre for IT equipment; and SS726, liquid cooling in tropical data centre.

By embedding all these specific professional registries into our ecosystem, we ensure that every person touching our digital infrastructure is bound by clear professional accountability, continuous professional development and rigorous ethical standards.

In conclusion, Mr Speaker, Singapore's competitive edge means that we always have to rely on stable, trusted and yet highly agile business environment. Of course, the digital infrastructures provide much of that currently. I would urge the Ministry and IMDA to adopt a highly collaborative, consultative enforcement posture during this transition period. Sir, with these concerns and clarifications, I support the Bill.

Mr Speaker: Mr Saktiandi Supaat.

7.06 pm

Mr Saktiandi Supaat (Bishan-Toa Payoh): Mr Speaker, Sir, I rise in support of the Bill which introduces licensing and regulatory frameworks for crucial digital infrastructure and data centre operators.

In Singapore today, digital infrastructure is the invisible bedrock of our economy. It enables PayNow and Community Development Council Voucher payments, Singpass services, cloud storage and workplace software. The global AI revolution is now driving unprecedented demand for such infrastructure.

This Bill is a timely and necessary step to keep our "digital gateways" resilient, secure and sustainable, just as earlier generations did for our airport and seaport. But we must ensure that resilience and sustainability do not erode competitiveness, impose undue burdens on local enterprises or leave our workforce behind. I will address five areas in my Bill speech.

The Bill introduces a security and resilience licensing regime for major co-location and cloud data centres with a critical IT load of at least 10 megawatts, and major cloud service providers earning at least $100 million in average annual revenue from Singapore users. It covers operational risks including technical failures, power outages and fires, complementing cyber-risk management under the Cybersecurity Act.

In practice, however, the line between an operational failure and a cyber incident can be blurred. A cooling system failure may be a hardware malfunction or a cyber-intrusion into a facility's Operational Technology network. How will IMDA coordinate with the CSA in such dual-faceted incidents?

The Government's consultation response says MDDI, CSA and IMDA will streamline both regimes. Where reporting requirements overlap, licensees need report only to IMDA, which will share relevant information with CSA. Could IMDA simply be the single port of call for digital infrastructure operators, leaving CSA to obtain what it needs from IMDA?

During a crisis, operators should focus on recovery and mitigation, not navigate duplicative reporting.

Compliance also has a cost. Licensees must implement rigorous security risk management measures and business continuity plans. Major MNCs may readily absorb these costs, but how will the Ministry keep the burden proportionate?

Detailed requirements will be set through Codes of Practice after industry consultation. What is the expected implementation timeline and have the proposed standards been benchmarked against other jurisdictions to keep Singapore attractive for global tech investment?

Second, impact on local enterprises and SMEs. Sir, I turn to the downstream impact on local enterprises and SMEs.

I have emphasised in this House that supporting local SMEs and attracting global MNCs are not competing choices. Major cloud providers and data centres form the foundation for thousands of local businesses, from e-commerce hosting to enterprise resource-planning software.

Compliance costs may flow down the value chain. Has the Ministry assessed how the Bill could affect the pricing of cloud and co-location services in Singapore? If digital-infrastructure costs rise, SMEs already facing tight margins and higher operating costs may bear the brunt. Are support mechanisms or grants planned to help local enterprises absorb possible price increases and keep digitalisation affordable for heartland businesses?

Third, synergising green digital infrastructure initiatives. The Bill rightly addresses environmental sustainability, especially important given data centres' high energy and water use in resource-scarce Singapore.

I am concerned about constraints such as green-power availability and grid readiness, even as AI and digital workloads surge beyond our critical sectors. How will regulation under this Bill and physical-infrastructure planning be aligned with Singapore's digital economy and Net Zero goals, including IMDA's Green Data Centre Roadmap and the EDB's and JTC's sustainable-energy initiatives on Jurong Island?

Could the Ministry of Energy, Trade and Industry update the House on the implementation of Jurong Island's 700 megawatts low-carbon data centre park and the lessons learnt so far?

All data centres with a critical IT load of at least three megawatts must be licensed and meet facility-level energy-efficiency requirements, including PUE standards. New facilities can incorporate advanced water-cooling and energy efficient designs, but legacy centres face substantial physical and financial retrofit challenges. The consultation response says clean-energy and economic commitments will apply only to new applicants, while PUE, IT-equipment and water efficiency requirements will be set at practical levels after consultation.

The question I have is how will the Government address the gap between the efficiency requirements for new and legacy data centres? How many data centres operate today and how many were established after the three-year moratorium on state-land development ended in 2022? And what proportion will fall under the new licensing regime? Do we have their current energy and water efficiency metrics, and how far are they from the "ideal" levels envisaged under the framework? Will the Government also provide support or co-funding for operators to upgrade legacy infrastructure and adopt alternatives such as microgrids and low-carbon hydrogen or ammonia?

Fourth, on sovereign compute and assured access. I turn to sovereign compute now, Singapore's ability to secure sufficient computing resources, with enough control to keep essential digital services running during external disruptions.

This should combine domestic capability with trusted international partnerships. Location alone is insufficient; we must know who controls operations, what external dependencies exist and whether critical services can continue if access to a major technology provider is disrupted.

I welcome the expansion of national research computing through ASPIRE 2B. How do we assess the minimum assured capacity needed for essential public services and critical sectors, covering hardware, software, operational expertise and the AI applications on which these services increasingly rely?

The other question I have is: could MDDI, sector regulators and infrastructure providers regularly stress-test a prolonged loss of access to a major cloud or AI provider, including from changes in overseas rules? For critical systems, these exercises should test how quickly an alternative can take over and whether it shares the same dependencies. A back-up helps only if it works when needed.

There is also an economic dimension. The Bill allows commitments made to secure new data centre capacity to become licence conditions. Could future allocations, where appropriate, support commercially agreed arrangements giving Singapore researchers, start-ups and SMEs more predictable access to compute? These should build on existing schemes and recognise the distinct roles of data centre operators and compute providers. Given our land and energy constraints, such arrangements must focus on essential needs and measurable benefits. Scarce capacity should strengthen critical services, useful innovation and local capability.

Finally, Mr Speaker, I turn to our workforce. The Bill's success rests on Singapore's human infrastructure: the engineers, architects and operators who execute even the best technical blueprints.

Singapore faces a global data centre talent crunch just as the Bill will increase demand for compliance auditors, PUE-literate sustainability engineers and operational risk managers able to bridge physical and digital security. The question I have is: do we have a sufficient local pipeline?

These lean operations cannot rely on plug-and-play hiring after short courses. Engineers need expertise in high-voltage power, cooling architecture, cybersecurity, uptime protocols, incident response and high-density AI racks – judgement largely gained in live, mission-critical environments.

Shortages already span site-reliability engineers, GPU-cluster and liquid cooling specialists and cybersecurity experts. The question I have is, how are MDDI, the Ministry of Manpower and our institutes of higher learning adapting education and workforce training so Singaporeans can take up these high value roles?

Meanwhile, entry-level pathways are narrowing. Entry-level tech-engineer recruitment reportedly fell by 25% to 60% in 2024 to 2025, as hyperscalers and highly automated sites adopted leaner staffing. AI-driven predictive maintenance and advanced management tools as well caused this. Junior engineers therefore have fewer opportunities to build the experience held by their seniors.

Has the Government studied the requirements and gaps in this specialised workforce, and are immediate interventions planned? What safeguards or assessments will ensure prospective operators have enough high-quality engineering and operational talent to meet Part 4's standards, without over-relying on transient foreign labour or stretching local teams too thin?

Aerospace and maritime offer useful precedents. When engineering shortages threatened Singapore's hub status, the Government responded through Industry and Jobs Transformation Maps and tripartite frameworks. So, will MDDI work with the Asia Pacific Data Centre Association, for example, to create a local training framework or a shared technical emergency pool that operators can draw on during compliance shocks?

As next-generation, AI-ready and sustainable facilities offer roles paying well above national average, can we systematically move Singaporeans into a higher-value tier of tech professionals? The Bill's resource-efficiency standards can build expertise in liquid cooling, real-time energy tracking and high-density AI-rack architecture. How will higher regulatory standards be translated into structured local capabilities? This is important.

Building on the Green Skills Committee's work, will the Government consider a dedicated Data Centre Green Skills Academy, with fast-tracked conversion pathways for mid-career mechanical and electrical engineers to become green data centre specialists?

Other mid-career professionals will likewise need structured competencies for next-generation facilities. As Singapore seeks to anchor ASEAN's interdependent digital infrastructure ecosystem, can we develop and base here the senior managers, cloud architects and sustainability consultants who support the region? How will Singaporeans remain the primary beneficiaries of these careers?

Mr Speaker, Sir, this Bill is a necessary shield for the foundations of our digital economy and our digital sovereignty. It also allows Singapore to set strong security and sustainability standards, develop world leading infrastructure operators and become the talent capital of the digital-infrastructure boom in the region and hopefully, globally as well.

Sir, I support the Bill and I look forward to the Senior Minister of State's clarifications.

Mr Speaker: Mr Shawn Loh.

7.18 pm

Mr Shawn Loh (Jalan Besar): Mr Speaker, we have been in Parliament for nine hours and we are fast running out of capacity. So, I will keep my speech quite short. I support the Digital Infrastructure Bill.

Singapore helped to kickstart the data centre industry in this region. We built an early lead through reliable infrastructure, strong connectivity and trusted institutions. I saw the strength first-hand of that position during my two years at EDB.

Demand for data-centre capacity was insatiable. Companies were prepared to invest copious amounts of money, hundreds of millions of dollars in a single project. This was an easy way to hit our investment key performance indictor (KPI). But unfortunately, even the most attractive KPI cannot generate more land, power or water. So, we did not close many deals. Some felt that Singapore was leaving money on the table. Perhaps we were. But in Singapore, even the table itself needs to be reviewed given our resource constraints.

And the resource footprint of a data centre is easy to see. The "cloud" nowadays is different. This cloud takes up land. You cannot get water from this cloud. Instead, it needs a lot of water. And instead of producing lightning, this cloud consumes a great deal of electricity.

In 2020, data centres accounted for about 7% of Singapore's electricity consumption, when we had around one gigawatt of capacity. Today, we have around 1.6 gigawatts. I hope the Government can clarify whether growing demand from data centres has affected electricity prices for retail consumers or the stability of our power grid.

Overall, the Government has set out the right strategic ambition. If I may suggest a simple way to think about this: we must look for value over volume; capability on top of capacity. I will make three points about how we can do so.

First, data centres should not only train AI models. They should also train Singaporeans in new frontier capabilities. Data centres are highly capital-intensive and create relatively few jobs directly. That is simply their nature.

But we do not have to accept this. Data centres can help build stronger capabilities across our digital economy.

Beyond that entry level exposure, the next step is for data centre operators to work with cloud providers, educational institutions and local firms to give Singaporeans greater exposure to the higher value work surrounding these facilities. This could include design, research and regional projects. And as the industry moves up the value chain, Singaporeans should be able to move up with it.

Second, we should move from hosting digital infrastructure to developing solutions that we can export. Apart from capability development, we should also look at how Singapore can mix and match our areas of strength, so that we can develop and export technologies that are uniquely ours.

Singapore's constraints are real. But constraints can also drive innovation. If we can solve the difficult problems of cooling, energy efficiency and grid integration in a dense tropical city, those solutions should have value well beyond Singapore.

We are already beginning to test such ideas. Some examples are at the intersection of digital infrastructure and energy infrastructure. This can get slightly technical. But let us power through it.

Most of our electricity is generated using natural gas. Liquefied natural gas is stored at extremely low temperatures. When it is converted back into gas, it releases "cold energy" that would normally be discharged. Singapore organisations are already studying whether that cold energy could instead be used to cool data centres.

We can take a similar approach to grid resilience. Instead of treating data centres and their supporting energy infrastructure as separate systems, we can design them together. The planned low-carbon Data Centre Park on Jurong Island offers an opportunity to test microgrids that are not connected to our main power grid. We can also test batteries and low-carbon energy systems in an integrated way.

If such projects are successful, the expertise developed here could help Singapore serve other regions facing similar constraints. The tighter our constraints, the more valuable that expertise becomes.

Third, look not only at the development of new data centres, but consider the redevelopment of existing capacity. Data centres may operate for decades, but technologies and computing needs will not stand still. We cannot afford infrastructure that consumes a great deal of electrical current but is no longer current itself. It is quite like housing: we do not just think of new greenfield developments, but we think about redeveloping that existing housing stock.

Operators should have strong incentives, as well as clear and timely pathways to upgrade their facilities ahead of time. Where redevelopment, consolidation or even voluntary retirement can release scarce land and power for higher value uses, the Government should consider how operators can share in the value that they help to create. This must be balanced with investment certainty. Operators need clear expectations, reasonable transition periods and confidence that genuine improvements will be recognised.

Mr Speaker, taking a step back, the Government already considers strategic value, innovation, talent development and ecosystem partnerships when allocating new capacity. That is the right approach.

I suggest that the Government also report periodically, in aggregate, on what successful projects eventually deliver. We should measure not only how much capacity Singapore has added, but what that capacity has added to Singapore and Singaporeans.

In conclusion, digital infrastructure may be a new utility, but the next step in our strategy is a familiar one. Singapore helped establish this industry in the region. The task ahead is to move up the value chain. That means capturing more value from the infrastructure we already host, continually renewing the capacity we already have and developing solutions to help the region grow together. With this framework in place, future EDB officers, like I was, will have an easier job to close good deals.

Singapore does not need to be the region's largest digital infrastructure market. We may be short of capacity, but we should never be short of capability. I am confident that we can remain the region's most trusted, capable and strategically valuable digital-infrastructure hub.

On that basis and before anyone's capacity is exhausted, I support the Bill.

Mr Speaker: Dr David Hoe.

7.27 pm

Mr David Hoe (Jurong East-Bukit Batok): Mr Speaker, I support the Bill.

To some, digital infrastructure may sound intangible. But in reality, it rests on the foundation that are physical in nature – the servers, the data centres, the electricity, the cooling system, the water, the network and other infrastructure.

As our reliance on digital services grows, we therefore need to consider both how resilient the infrastructure is when something goes wrong, and how efficiently it uses finite resources needed to keep it running. So, I will focus broadly on two areas.

First, on resilience. We need to look beyond individual operators to common dependency across the system. Clause 15 requires major foundational digital infrastructure service provider to minimise unexpected interruption and maintain business continuity and disaster recovery plans.

A cloud or data centre operator can have very strong internal system and still depend on external providers for hardware, software, telecommunication networks, electricity infrastructure and other third party services. More importantly, several cloud and data centre operators may ultimately rely on the same upstream infrastructure and external provider.

What may appear to look like diversification across companies may therefore still be concentration at the system level. So, could the Senior Minister of State clarify whether the eventual resilience requirement will require licensee to identify material third party and common dependency risk? Beyond what the individual licensee can see, how will IMDA identify concentration risks, where several major providers depend on the same power, same network and same infrastructure?

This is also increasingly interesting because of the cross-border dimension of this Bill. The Bill itself recognises that major foundational digital infrastructure may be provided from outside of Singapore for users in Singapore. This can be increasingly relevant with the Johor-Singapore Special Economic Zone as it develops, including through the data centres and other digital infrastructure operating models spanning across Singapore and Johor.

This is also a related question on jurisdiction dependency, where major cloud service rely upon in Singapore is owned, controlled or operationally managed from another jurisdiction, will IMDA resilience assessment consider whether foreign laws, regulatory direction or external actions could affect Singapore's continued access to that service? For especially critical workload, does the Government see a role for a sovereign cloud capability where that infrastructure and operational control legal accountability are sufficiently anchored in Singapore?

Second, incident reporting should help us identify disruption before it cascades. The Bill provides for prescribed service disruptions to be reported to the authority, with the detailed thresholds and timelines to be set subsequently. Could the Senior Minister of State explain the principles that will determine when an incident is reportable and the timelines under our framework? Will this consider how long a disruption lasts but also the scale, the criticality of the services affected and its potential cascading impact?

There is also a practical balance we have to strike. The Government needs early situational awareness, especially when separate incidents may share a common cause. But operators may still be diagnosing the problem while working urgently to resolve this issue. How will IMDA balance the needs? More broadly, beyond regulatory compliance, how does IMDA intend to use these incident reports? How does IMDA hope to that these data points would be used to strengthen the resilience of the wider ecosystem?

I now turn to resource discipline, starting with how energy and water efficiency standards will be set and balanced.

Clause 35 requires minimum facility-level energy efficiency, equipment-level energy efficiency and minimum facility-level water efficiency. The Bill understandably leaves the actual thresholds to subsequent regulation. But could the Senior Minister of State elaborate how these principles will guide these minimum standards and how they will be updated as technology improves? This matters because demanding standards today might be commonplace several years from now.

I also ask how these three requirements will work together. Energy and water efficiency should not be treated entirely in isolation. Depending on the cooling system and facility design, improving one may have implications on the other. Will IMDA therefore assess the three separate requirements or as a holistic sustainability framework? When trade-offs arise, in my view, the aim should be to improve overall resource efficiency of the facility rather than simply shifting consumption from one resource to another.

At the same time, responsibility should be matched with a degree of control that an operator can reasonably exercise. Clause 35(b) applies equipment-level efficiency requirements to even IT equipment installed by customers of the data centre operator. The operator may control the building, cooling and power infrastructure, while customers own and operate the servers housed within it.

I understand that the mandatory equipment-level requirements are not intended to be imposed at the outset. But if they are to be introduced subsequently, how would these responsibilities be divided between operators and customers? Because this also affects compliance.

Clause 36 requires regular reporting and IMDA can require an audit. But where an operator houses equipment belonging to many different customers, how will compliance with equipment-level requirements be measured and verified, and when would independent audit be required? Clear accountability will make eventual standards easier both to comply with and to enforce.

Third, still on resource discipline. What might the transition pathway for existing facilities look like? New facilities can be designed around current standards from the outset. Older facilities may require substantial changes to cooling systems, power architecture or other infrastructure.

I understand from the Senior Minister of State earlier that existing operators will be given transition time. But could he explain how would this work in practice? Because this framework should recognise genuine technical constraints and reasonable retrofit timelines while still ensuring meaningful improvements over time.

Finally, we should be clear about how efficiency, cleaner electricity and carbon measures fit together. This Bill allows us the authority to consider three things: first, the renewability and carbon intensity of electricity used by data centres; second, imported electricity; and third, the impact of their energy consumption on Singapore's emissions commitments.

Could the Senior Minister of State clarify whether there is an intended hierarchy among these measures? For example, should the first step be to reduce electricity demand through efficiency, followed by using low-carbon electricity where practical, and finally, carbon credits addressing remaining emissions?

Because these approaches do different things. Efficiency reduces pressure on the electricity system itself. Cleaner electricity reduces the emissions associated with demand. Carbon credits address residual emissions through another mechanism.

Where international carbon credits are used, I would also welcome clarification on the standards that will ensure their environmental integrity. More broadly, as the sector grows, individual data centres may become more efficient while total electricity and water usage would still rise in absolute terms.

Since clause 36 will give IMDA regular information from operators, would the Government consider publishing aggregated sector-level indicators over time, including distribution or trajectory of the PUE, alongside water efficiency and carbon profile of electricity used, where commercial confidentiality can be protected?

Why is this important? Because this would help us assess not only whether individual facilities are improving, but whether the sector as a whole is using resources more efficiently as computing demand expands.

Mr Speaker, digital infrastructure is increasingly an essential infrastructure. My two broad concerns are therefore straightforward: first, resilience must extend beyond individual operators to the dependencies and disruptions that can affect the system as a whole; second, growth in computing capacity must be accompanied by clear, progressive, stronger discipline over electricity, water and carbon. With these clarifications, I support the Bill.

7.37 pm

Mr Speaker: Senior Minister of State Tan.