As India eyes a US$1 trillion digital boom, will it spawn a data-driven resource crunch?

The power needs of India’s data centres more than doubled over the span of three years and the momentum doesn’t look set to slow any time soon

State-run distributors don’t want to supply them with renewable energy, observer say, but a pivot to smaller ‘edge data centres’ could be a solution

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Electricians work on a pylon in New Delhi. In the three years to 2022, the amount of electricity required by India’s data centres more than doubled to 722 megawatts. Photo: AFP

Published: 9:30am, 20 Jul 2023

India’s growing embrace of all things digital has gifted the country everything from the convenience of mobile payments to online health cards, but industry insiders say it’s also fuelling a rush on energy-intensive data centres that drain critical power and water resources.

In the three years to 2022, the amount of electricity required by India’s data centres more than doubled to 722 megawatts, according to commercial property services company JLL India – momentum that’s unlikely to slow as policymakers aim to build a US$1 trillion digital economy by 2026.

“India’s data centre industry is set to witness continued growth,” said Rachit Mohan, JLL India’s data centre advisory head, who forecast that by 2025 its expansion would require an additional 9.1 million square feet (85 hectares) of land worth some US$4.8 billion.

Data centres are networked facilities whose servers, storage systems and computing infrastructure enable organisations to process, store and disseminate large amounts of data: the hi-tech fuel of the modern economy.

Labourers work on a construction site in Mumbai last month. Data centres are putting growing pressure on power and water infrastructure as they increasingly crop up in India’s major metro areas. Photo: AFP

But as these centres increasingly crop up in Mumbai, Bangalore and India’s other major metro areas to be close to the end consumers, it’s putting growing pressure on the power and water infrastructure that they require in abundance.