Power Demand from AI Data Centres in India Could Hit 50 TWh a Year by 2030, Driven by Rapid Digital Growth

A McKinsey report revealed that the annual global demand for data centre capacity could rise at an annual rate between 19% and 22% from 2023 to 2030, to reach an annual demand of 171 to 219 gigawatts (GW), against the total current demand of 60 GW. To avoid a deficit, at least twice as much data centre capacity built since 2000 will have to be in place in less than a quarter of the time.

Considering the power consumption required by computer systems to smoothly run AI, energy demand is naturally increasing, Anwesha Sen, an assistant programme manager at Takshashila University studying the impact of technology policy and AI on society, told The Hindu. However, she underscored that the requirement is not as drastic as other energy-intensive industries.

According to McKinsey, India’s data centre demand is expected to surge from 1.2 GW in 2024 to 4.5 GW by 2030, primarily due to AI and digital adoption across sectors. Mumbai accounts for 41% of the data centre capacity, followed by Chennai (23%) and the National Capital Region (14%).

Sharing insights on the amount of electricity consumption that AI can do in India, Raghu Raman, professor and Dean at the School of Business at Amrita Vishwa Vidyapeetham told The Hindu that AI-driven data centres in India are predicted to consume an additional 40-50 TWh of electricity annually by 2030.

Rising Demand for Data Centres

The rapid expansion of artificial intelligence (AI) is causing an increase in the global demand for data capacity. Colliers India reported that India’s data centre capacity had surged to 1.26 gigawatts (GW) in April 2025, up from 0.3 GW in 2018. A 30-fold increase in data traffic since FY17, contributed by increasing smartphone penetration, over-the-top (OTT) platforms, digital payments, and e-commerce, has driven growth, reported Financial Express.

According to a report by Jefferies, increased internet traffic will cause the capacity to quintuple to 8 GW over the next five years, reported ANI.  An estimated $30 billion (roughly ₹2.6 trillion) will be needed to fund this expansion. Real estate ($6 billion), electrical and power systems ($10 billion), racks ($7 billion), cooling systems ($4 billion) and network infrastructure ($1 billion) will all benefit from these new opportunities.