India’s data centre capacity crosses 1,575 MW, could hit 9 GW by 2030 amid rising power, water concerns: PCC

India’s data centre capacity has surged more than four-fold since 2020, reaching over 1,575 MW in 2025 from around 375 MW, as cloud adoption, 5G, data localisation and artificial intelligence drive rapid expansion of digital infrastructure. A new discussion paper by the Policy Consensus Centre (PCC) estimates that capacity could rise to 4.5–9 GW by 2030, with the sector attracting around US$95 billion in cumulative investment commitments between 2019 and 2025.

The paper, Living Next to the Cloud: An Evidence-Based Approach to Data Centres in Residential India, examines the growing proximity of large data centre facilities to residential communities. PCC said the policy challenge is increasingly about managing coexistence through measurable standards rather than imposing blanket restrictions on facilities in urban areas. Its review of environmental clearance filings in Maharashtra and Tamil Nadu also found operators adopting measures covering cooling, noise control and power infrastructure.

Noise remains a key community concern

PCC said cooling equipment, transformers and ventilation systems can generate 45–65 dB at a facility’s property boundary, against residential limits of 55 dB during the day and 45 dB at night. The paper cited a study covering 70 monitoring stations across seven major cities that found applicable noise standards were exceeded at monitored residential, commercial and silence-zone locations.

The report noted that AWS’s Thane project provides for acoustic enclosures and barriers around backup generators, while Nxtra’s Siruseri facility requires acoustic enclosures for all noise-generating equipment. Raiden Infotech’s Turbhe project, meanwhile, provides for quarterly third-party noise monitoring.

Power demand could reach 9 GW by 2030

Electricity consumption is another pressure point. PCC estimates data centre electricity demand could rise from around 1.4 GW in 2024 to 9 GW by 2030, increasing the need for grid, transmission and renewable-energy planning. AWS’s Thane campus, according to its clearance filing, uses hot-aisle containment, free-air cooling and air-cooled chillers, reducing estimated cooling energy consumption by 29% against the Energy Conservation Building Code baseline.

Water use is similarly location-specific. A typical 100 MW hyperscale facility using water-based cooling can consume 800,000–2 million litres a day. PCC estimates India’s data centres consumed about 150 billion litres in 2024–25, potentially rising to 358 billion litres by 2030.

PCC seeks greater disclosure and tighter norms

The paper found that six of seven clearances reviewed did not require a full environmental impact assessment or public hearing, while only six of 23 compliance reports recorded a site inspection. The seven projects together provide for more than 600 large diesel generator sets, with backup capacity exceeding their combined grid demand.

PCC has proposed district-level mapping of land, power and water capacity, standardised facility-level reporting of electricity, water and noise, minimum setbacks near homes, cleaner backup power, renewable-energy adoption and greater use of treated non-potable water for cooling. It also called for a dedicated data centre chapter in the National Building Code and national model guidelines for states.

The paper’s central finding is that India’s data centre expansion need not be framed as a choice between digital infrastructure and residential communities. PCC said the more practical policy question is whether location, technology, resource availability and operational performance can be measured upfront and regulated transparently.