India's Data Centre Boom Needs an Energy and Water Plan

Data centres are central to India's digital and AI ambitions. But their locations, water and energy consumption requirements within the localised demand for household, business and other industry need systematic planning.

Recent protests and concerns show that unless carefully planned, data centres may create a headache by triggering social conflicts. Protests over data centre creation in states like Maharashtra and Andhra Pradesh are a signal that care should be taken while installing infrastructure for these projects.

Data centres are the backbone of the new digital economy; especially AI and automation. Inevitably data centres require significant amount of power and water to perform the task.

Higher the processing, higher will be the energy requirement and higher will be the water needed to cool the systems.

Regarding resource consumption, highly AI-focused hyperscale data centres may use an average of 5-10 million gallons of water per day. Their power draw can equal the consumption needs of 100,000-plus households.

One of the largest data centres in the world ? the China Telecom Inner Mongolia Information Park in Hohhot, China has an area of 10.7 million square feet. It consumes nearly 150 megawatts a day. It is estimated to consume roughly 11 million litres (2.7 million gallons) of water per day. The energy requirement of the Hohhot facility is nearly 0.06% of India's peak energy consumption requirements (250 GW).

The Hohhot facility is situated in a cooler area and benefits from cool climate that reduces electricity demand for cooling. But in India, the average temperature is very high and hence requires substantial energy for running.

In India, the Yotta NM1 facility in Navi Mumbai is the largest till date and it is having a power consumption of nearly 52 megawatts.

Given the infrastructure resources requirements, often, the presence of data centres attracts local protests. People often fear that higher water requirements will adversely affect their living conditions.

A significant amount of energy is used in data centres for the working of coolers, chillers and fans which are to be there to cool the servers.

India is witnessing a rapid growth in the establishment of data centres. The installed capacity of data centres jumped from just 530 MW in 2020 to 1.8 GW by early-2026.

It is estimated that a single 100 MW data centre requires at least 2 million litres of water per day. With the rapid modernization of technology, the water and electricity requirements may come down. On the other hand, there is a perception that the demand for high end tasks may increase with time and this may necessitate more water and energy consumption.

Given this conflict for resources in areas where data centres are to be created, the authorities should create a comprehensive strategy on water and power requirements. This should be made by considering the overall availability of water and energy in a localised perspective.