Data Centres in India Projected to Become 2nd Largest Power Purchaser in Apac Region

India is expected to become the second largest market market for electricity demand for data centres by 2030 in the Asia Pacific region, surpassing Australia and Japan, S&P Global estimates said on Wednesday.

As per the latest figures, the share of electricity of the data centres will triple from 0.84 per cent in 2024 to 2.6 per cent of the total electricity generated in the country by 2030. This is because during the same period, India’s data centre power requirement will grow five times from 13 terra watt hour (TWh) in 2024 to 57 TWh in 2030, marking an annual average growth of 28 per cent.

Around 34,317 graphics processing units (GPUs) were awarded to data centre companies by the government under the AI mission. Half of these have already been installed. Once fully operational, these GPUs are estimated to provide about 2 TWh of additional electricity, accounting for a substantial 10 per cent of the estimated power demand by all data centres in the country in 2025, the data mentioned.

However, S&P has pointed out that there will be sufficient renewable capacity, where most data centres are focusing on, to meet the additional demand. It further reasons that India will require an additional 15-30 Gw of power for data centres, which comprises of around 10 per cent of the total renewable planned additions projected during the period.

This, they point out can be easily managed by the country as it has significant untapped renewable potential and favourable economics for solar and wind. In addition to that, battery storage is already competitive in hybrid models with renewables being compared to conventional sources.

Most of the data centre companies have already announced a clear plan for 100 per cent renewable targets. These include Amazon Web Service who has given a deadline of 2030 as well as Sify Technologies by 2027, Nxt Gen Data centre by 2025 and ST Telemedia by 2026 among many others.

Additionally, the immense growth of data centres can be reflected in the fact that global as well as local players have announced investments of $32 billion in the last two years in this space. Currently, as much as half the data centres in the country are companies which are headquartered in India, followed by Japan (19 per cent), Singapore (over 17 per cent) and the US (9.9 per cent).

State governments have pushed for the proliferation of data centres, which offer subsidies and guaranteed uninterrupted power like in Maharashtra, Telangana and Karnataka and the upcoming Uttar Pradesh, which account for 70 per cent of the data centre capacity in the country.