This January, Adani Enterprises signed an agreement with the Maharashtra government for a Rs 50,000 crore investment to set up a 1 gigawatt (GW) data centre, apart from Rs 5,000 crore for a 100 megawatt (MW) data centre in Telangana.
Tech giant Meta, ET reported in April, would open its first data centre in India on a 10-acre campus in Chennai.
It is critical for a data centre to maintain a temperature of around 220 C. “Data centres consume significant amounts of water for cooling purposes.
Over half the data centres are located in Mumbai and 15-18% in Chennai due to the proximity to submarine cable connectivity.
In the case of water use by data centres, it will be better to pre-empt a crisis, she says.Adding to the issue is the fact that there’s no national policy on water use by data centres.
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The data on data centres in India converges on one point: there is no stopping its growth . This January, Adani Enterprises signed an agreement with the Maharashtra government for a Rs 50,000 crore investment to set up a 1 gigawatt (GW) data centre, apart from Rs 5,000 crore for a 100 megawatt (MW) data centre in Telangana. Tech giant Meta, ET reported in April, would open its first data centre in India on a 10-acre campus in Chennai. Meanwhile, Google’s parent company Alphabet is reported to be in talks for its first captive data centre in India in Navi Mumbai.A report by ratings agency CareEdge in May estimates that India would double its data centre capacity from under 1 GW now to 2 GW by 2026, while another by Cushman & Wakefield in June forecasts that by 2028, India will have thrice the installed capacity, at 3.29 GW.India is still a minnow compared with US, the market leader in data centres. Northern Virginia alone has a capacity of over 8 GW, says Vivek Dahiya , head–data centre advisory team (Asia Pacific), Cushman & Wakefield. But as data centres in India grow in number and capacity, it is likely that it will have to grapple with an important question: will its cities, which are already water-stressed, be able to support this scorching pace of growth of a sector considered to be water-guzzling?Across the world, it’s a challenge playing out in regions facing a water shortage, exacerbated by drought, resulting in friction with local communities in areas like Arizona in the US and Santiago in Chile. Experts in water conservation say this is a question India’s policymakers might want to address early on, with the sector poised for exponential growth.Data centres are variously described as the beating heart of the digital economy , its reservoir and backbone. Apart from housing an organisation’s IT applications and services, it is also where all the data we generate when we use various applications, whether making a digital payment or binge-watching a show, are stored and processed.“Over the last 10-20 years, colocation firms, which are service providers, have come up, renting out rack space (in data centres), similar to WeWork renting out cubicles,” says Dahiya.Then there are the hyperscalers, or the large cloud data centres, operated by the likes of Amazon Web Services and Google Cloud Platform. The rise of generative AI is further supercharging the growth of the segment. India may have been late to the data centre party but it’s now catching up, thanks to a host of catalysts—from the increasing amount of data consumed by India’s estimated 800 million internet users to growing digitisation across the board to recent legislation in the form of the Digital Personal Data Protection Act and the requirement to store and process data locally.“At one point, countries which had good airports and ports prospered. In today’s digital economy, countries which have the right data centre infrastructure—which will be the heart of the digital economy—will gain from that economically,” says Vipin Jain, president– datacentre operations, CtrlS Datacenters, which is planning to increase capacity 2-2.5 times in the next three years.For this segment in a hurry, the question of sustainable water use arises due to two reasons: one, its need, typically, for large quantities of water for cooling (apart from as a source of power) because of the heat generated in its functioning. It is critical for a data centre to maintain a temperature of around 220 C. “Data centres consume significant amounts of water for cooling purposes. Systems like evaporative cooling and chiller plants require continuous water supply to maintain optimal server temperatures,” says Praveen Ramamurthy, chair, Interdisciplinary Centre for Water Research, Indian Institute of Science (IISc). In water-based chillers, the conventional mode of cooling, water is cooled in a central chiller and circulated through pipes and coils to cool the air in the data centre.Two, data centres in India are located in some of its biggest cities, most of which already face water supply issues, as this summer underlined. Over half the data centres are located in Mumbai and 15-18% in Chennai due to the proximity to submarine cable connectivity. Mumbai also has a significant presence of banking and finance sectors that are important customers of data centres. In a 2021 report by industry body Nasscom, titled, “India: The Next Data Center Hub”, water shortage was cited as a high-risk factor for data centres in Chennai, Bengaluru, Hyderabad and Delhi, and moderate-to-high risk for Mumbai.The amount of water a data centre needs for cooling depends on the cooling technology used, its location, efficiency measures and capacity. A commonly cited figure from a 2021 study published in Nature estimated that a 1 MW data centre that reduces air temperature by cooling water “can use around 25.5 million litres of water per year”, or 68,500 litres a day. This would mean a 20 MW data centre would need about 1.37 million litres a day if it uses a water-intensive cooling solution. Meanwhile, daily water supply is just over 1,000 million litres in Chennai, about 1,500 million litres in Bengaluru and close to 3,000 million litres in Mumbai, with demand pegged higher.“India’s water issues arise from the fact that we have 18% of global population but only 4% of water resources,” says Sahana Goswami, senior manager–water resilience team, WRI India, adding that about 80% of water we use is in the agriculture sector. In the case of water use by data centres, it will be better to pre-empt a crisis, she says.Adding to the issue is the fact that there’s no national policy on water use by data centres. The only mention of water in a 2020 draft national policy is a line saying that states shall be encouraged to set up data centre parks with necessary infrastructure, including availability of water. “It’s very important we get good policy around data centres because it’s critical infrastructure,” says Goswami.Stakeholders say data centres in India have factored in the shortage of water in Indian cities. For instance, multinational digital infrastructure company Equinix, which entered the Indian market in 2020, uses only air-cooled chillers here instead of water-cooled chillers. “We decided to use air-cooled chillers because India has had years of drought and if we cannot get water, data centres face the risk of not being able to operate at all. Our customers cannot run that risk,” says Manoj Paul, MD, Equinix India.CtrlS says it is also increasingly using air-cooled chillers. “The data centre industry in India has taken into account the fact that water will be scarce. Considering this, data centers here are moving in the direction of air-cooled chillers,” says Jain.Web Werks , which has announced facilities in Telangana, Karnataka and Maharashtra in a joint venture with global operator Iron Mountain, also says it uses cooling solutions that minimise water consumption. “Our data centres use air-cooled chillers for cooling, which sustain water utilisation over a longer period of time,” says Nikhil Rathi, founder and CEO, Web Werks-Iron Mountain Data Centers.Anand Kulkarni, director, CRISIL Ratings, says its initial analysis suggests that the type of data centres in India “don’t use much water-cooled chillers, hence the use of water is limited”.To cut down on the use of water and power for cooling and increase efficiency, companies globally are exploring different technologies, such as liquid immersion cooling. Here, the server is dipped in a tank filled with a dielectric coolant (which does not conduct electricity) that absorbs and dissipates the heat generated.With increased deployment of AI, where processing requirements are much higher and the heat load will proportionally go up, the use case for liquid cooling would strengthen.However, Sachin Bhalla, VP–secure power, Greater India, Schneider Electric, which provides cooling solutions to data centres, says the switch to liquid cooling would not be simple. “If you want to bring about liquid cooling, you have to change the type of servers you use. The end customer who is actually taking up data centres has to take the call whether they want to opt for it and order the hardware and advise the data centre builder accordingly.”Still, companies are experimenting. “Immersion cooling is the most efficient but also the most difficult to implement. There are risks because you are talking of liquid in the data hall. But we are trying it out in 100 centres across the globe,” says Paul. “We have started designing our new data centres, which can be fully cooled with liquid cooling. We are also working on liquid cooling solutions with some of our existing clients,” says Jain.Microsoft, which has three data centres in India, did not comment specifically on water use when contacted, only saying, “Microsoft started its data centre journey in India in 2015 and has three data centres, one each in Mumbai, Pune, and Chennai. It plans to open a fourth in Hyderabad that is expected to be operational by 2025.” ” In its 2024 environmental sustainability report, the company said one area where it was not on track was in “Reducing water use and replenishing more water than we consume in our datacenter operations”. But the report also mentioned that its new data centres are “designed and optimized to support AI workloads and will consume zero water for cooling”.“Reducing water use and replenishing more water than we consume in our datacenter operations”. But the report also mentioned that its new data centres are “designed and optimized to support AI workloads and will consume zero water for cooling”.While the expansion of data centres in India brings significant technological and economic benefits, it is crucial to balance this growth with sustainable water management practices, says Ramamurthy. Locating data centres in areas with ample water supply or access to non-potable water sources, developing and enforcing regulations to ensure sustainable water usage practices, including mandatory recycling and limits on groundwater extraction, he says, can help manage the water footprint of data centres and alleviate any pressure on water-stressed cities.
