Ratul Puri - Data Centres and Power

India is rapidly digitizing, creating a surge in demand for data centers. However, there are less visible factors that still play an important role, and electricity is one of them. The recent surge in the construction of data centers illustrates this. As India focuses on strengthening its power generation infrastructure, it must also work to enhance its reliable power infrastructure.

Ratul Puri and the Changing Power Needs of AI

The rising need for artificial intelligence (AI) is putting additional strain on the power system. The Ministry of Power projected that, by 2031-32, AI-powered data centers would increase India’s peak power demand by 26.3 GW. As the demand for AI is integrated into the grid through renewable energy, the focus should also be on enhancing data centers. As more AI workloads are integrated, more strain will be placed on data centers. Due to the changing nature of India’s electricity demand, Ratul Puri, Chairman, Hindustan Power says that more work should be done on the electricity supply side, focusing on reliability rather than increasing the supply side.

Data centers are not the only part of the economy driving new electricity demand. According to the International Energy Agency, India's annual electricity consumption is expected to increase by 6.4% between 2026 and 2030, by more than 570 TWh during this period. The growing electricity demand is occurring in all sectors. New demand in India is from industry, cooling, household sectors and transport, as well as other forms of electrification. Data centers, AI and other digital technologies create new and concentrated demand in these sectors. The quality and the quantity of the digital infrastructure will play a key role in meeting demand. As Mr. Puri notes, in a rapidly growing economy, the energy system must adapt to new consumption patterns..

The deployment of renewable energies in India will help meet the increasing electricity demand for the digital economy. However, the demands of the digital economy will also help to identify the limits of renewable energies. Solar energy is variable and depends on several factors, while the demand for electricity by data centers is continuous and has no off-peak hours. Ratul Puri has a view that the importance of both energy storage and transmission lies in addressing this difference. Storage can shift electricity across time, while transmission can move electricity from generation centres to areas where demand is highest.

Data centers will require the expanded use of high-voltage electric transmission. Renewable energy projects can be built just about anywhere; data centers will be built in commercial and digital hubs. So where will the demand be? Other large consumers will have the same issue. We need to find ways to move the generated renewable power to large consumer centers. This means we need to build more power transmission lines. But the focus should be on enhancing reliability for large consumer centers as well as adding renewable capacity.

Reliable Infrastructure for India’s Digital Growth

Transmission is the movement of electricity and storage is the storage of electricity. The difference will have to be better understood as the focus shifts to more renewable energy. Storage can address the difference in timing of demand and generation. Along with better integration of the transmission system, storage can also help provide flexibility to meet varying demands. Together, they can increase the flexibility of the system to meet the demands of a constantly changing system. Storage and transmission can help meet the demands of an ever-changing system. Along with the focus on digital and renewable energy demands, Ratul Puri sees the same focused integrations to improve and meet those demands.

India is experiencing digital and energy transformations simultaneously. Because of the growing demand and integration of Artificial Intelligence (AI), the power system is changing. Along with the transition to renewable energy, this increases the challenges in system balance. So the focus of the power sector needs to shift beyond adding capacity to the system. This needs to shift to ensuring modern infrastructure so that energy reaches where it is required and when it is needed. Beyond capacity to generate energy, there is more focus required on other energy infrastructure to support the economy, said Ratul Puri. This is particularly true for the digital economy of India and other similar economies. This requires more flexibility and integration of various energy systems and balancing to adequately support the digital economy.

Ratul Puri also added that in the future it will be more important to ensure the dependability of electricity in India rather than producing a large quantity of it.