GPU demand: Govt weighing dedicated grid, nuclear power for data centres

The government is exploring the feasibility of providing dedicated, uninterrupted power to large data centre parks either through direct lines from power producers or by setting up small nuclear plants nearby, officials told ET.The need for uninterrupted power to be supplied through a separate source of power will be felt as more data centres with artificial intelligence (AI) servers and graphic processing units (GPUs) will be set up across India, a senior government official said.

“That, in turn, means that both the quality of power being supplied and the uninterrupted…supply will have to be maintained at the highest standards. With AI servers and now GPUs coming into the picture, the demand will be a lot higher,” the official said.

One of the options is to allow these data centre parks to set up separate power grids, which will allow them to buy power from the power producer or some other power-surplus state instead of the state the infrastructure is domiciled in, another official said.

The electronics and information technology ministry had reached out to the power ministry to study the feasibility of this option.

“We are studying all the options and the best possible way ahead,” one of the officials quoted above said. “Whether an option will be feasible or not – cost-wise and infrastructure-wise – and ensuring minimal power loss will be a part of our study.”

The Indian data centre operational capacity is expected to more than double to 2,000-2,100 MW by 2026-27 from 950 MW in FY24 with an investment of up to Rs 55,000 crore.Most of this investment will be geared towards meeting the demand of colocation services backed by hyperscalers. These services will contribute up to 85% of the revenues for the data centres over the next three years, consultancy firm ICRA said in a report earlier this month.

“The low data tariff plans, access to affordable smartphones, adoption of new technologies and growing user base of social media, ecommerce, gaming and OTT platforms are some of the key triggers for data explosion,” Anupama Reddy, vice president of corporate ratings at ICRA, said. “Also, artificial intelligence (AI) led demand, which is expected to increase multi-fold in the next 3-5 years, presents significant opportunities,” she said.