The Role of Data Centres in the AI Era
In the current age where data is likened to the new oil, data centres have become the refineries, crucial for operating artificial intelligence (AI) applications. The surge in AI app launches globally has accelerated the demand for increased data centre capacity, including in India.
Data Centre Growth in India
- India's data centre capacity has grown from 0.30 GW in 2018 to 1.26 GW in April 2025.
- Projections suggest a rise to over 3 GW within the next five years, with investments ranging between $20-25 billion over six years.
- Major tech companies, like Google and OpenAI, are exploring locations for large-scale data centres in India.
Implications for Energy Demand and Carbon Emissions
- The increase in data centres is expected to significantly boost electricity demand, posing challenges to existing energy infrastructure.
- Globally, electricity consumption from AI-enabled data centres could grow six-fold by 2030.
- Data centres are responsible for 1.5% of global electricity demand, possibly reaching 3% by the decade's end.
- Despite a relative percentage of less than 1% in global carbon emissions, data centre emissions are among the fastest-growing.
Energy Efficiency and Sustainability Measures
- Efficiency regulations in countries like Japan and France could serve as models for India to combat high cooling demands.
- India's 'open access' rules allow data centres to purchase renewable energy directly.
- AI has potential roles in optimizing energy use, improving weather forecasts, and enhancing building and factory efficiencies.
Challenges and Recommendations
- Barriers to widespread AI deployment in energy include a lack of skills, scalable business models, and data for training AI models.
- Energy decision-makers are encouraged to focus on productive AI uses and sustainable infrastructure growth.
- While AI alone cannot resolve all energy concerns, these measures could propel future sustainable AI advancements.