含羞草社区

含羞草社区 data centre industry is growing exponentially, driven by the country’s need for cloud computing and data localisation. A major concern about such expansion is how to meet the significant energy needs of data centres. By 2024, data centres accounted for 2% of the country’s total energy demand. This is expected to rise to 6% by 2030. With environmental, social, and governance (ESG) considerations being at the fore for many businesses, there is a growing emphasis on designing data centres to optimise energy efficiency and become green facilities.

The Telecom Regulatory Authority of India (TRAI) released a in November 2022, proposing a regulatory framework to promote the data economy through data centres. It recommended, among other things, the creation of green data centre certification standards by the Indian Green Building Council (IGBC). It also urged the development by the Ministry of Power of a framework for power supply to data centres, including energy banking for green data centres. Following TRAI’s recommendations, in August 2024, the IGBC introduced a to certify green data centres, including benchmarks to verify their use of sustainable infrastructure, facilities that run on renewable energy and priority for efficient energy usage.

Many states have introduced policies for the development of data centres that account for their energy requirements. For example, to help the direct procurement of power by data centres, Uttar Pradesh allows their developers to apply for deemed distribution licensee or distribution franchisee status. In Maharashtra, data centre developers and data centre parks are eligible to apply for a deemed distribution licence. Data centre developers and colocation companies such as Nxtra, AdaniConneX and Ctlr+S are procuring renewable energy to power their data centres, driven by customer demands for sustainability.

Procurement of renewable power is one aspect of greening data centres; cooling is another. Because almost half the total energy consumption by a data centre goes into its cooling, there is a need for more efficient and innovative ways of dissipating heat. Usually, data centre cooling uses vast volumes of water, a scarce resource in India, particularly in the cities in which most data centre development is concentrated. Although the country does not yet have a policy for water use by data centres, many hyperscalers such as Microsoft and Google have led the way by using recycled wastewater to cool their data centres. Globally, data centre operators have adopted such innovations as liquid immersion and smart chillers, reducing their reliance on water.

Managing heat generated from data centres and how to direct its use is another concern. In Norway, the heat from an Oslo data centre is warming nearly 5,000 apartments. Excess energy from data centres can also aid food production and industrial processes.

Other jurisdictions, such as Singapore, require energy managers to be appointed in data centres. As well as carrying out other tasks, such personnel ensure compliance with energy consumption standards and assist data centre developers in submitting annual greenhouse gas emissions reports. In India, energy intensive industries are regulated under the Energy Conservation Act, 2001 (EC act). This allows the government, in consultation with the Bureau of Energy Efficiency, to prescribe energy consumption and efficiency standards that such industries must meet. The EC act requires that an energy manager be appointed in those sectors. Although data centres are not yet classified as energy intensive, they may choose to appoint energy managers to monitor power consumption and implement energy efficiency measures.

Greening data centres is capital intensive at the start. Colocation companies and hyperscalers have adopted innovative methods to ensure that their data centres meet ESG requirements. However, as India scales up data centre capacity, it needs to balance growth against ESG considerations to ensure that such growth is sustainable. Policymakers must create a welcoming regulatory environment for data centre development through incentives and by easing regulation of green power procurement. They should also ensure data centre energy efficiency by limiting water usage and encouraging heat recovery.

Megha Kaladharan is a partner and Adi Kidambi is an associate at Trilegal