India Data Center Power Market Growth, Size & Trends Forecast 2026-2034

The India Data Center Power Market reached a size of USD 836.2 million in 2025 and is forecasted to grow to USD 1,280.42 million by 2034. The market is expected to grow at a CAGR of 4.85% during the forecast period 2026-2034. Key growth drivers include government policy support, designation of data centers as infrastructure, rising renewable energy integration, and AI-driven infrastructure modernization requiring higher power density. The report presents a thorough review featuring the India Data Center Power Market Growth, share, trends, and research of the industry.

STUDY ASSUMPTION YEARS

• Base Year: 2025

• Historical Year/Period: 2020-2025

  
  

• Forecast Year/Period: 2026-2034

INDIA DATA CENTER POWER MARKET KEY TAKEAWAYS

• Current Market Size: USD 836.2 Million (2025)

• CAGR: 4.85% (2026-2034)

• Forecast Period: 2026-2034

• Government policy support and infrastructure status designation have enabled easier access to funding and accelerated development in data center power infrastructure.

• Rising demand for renewable energy integration driven by sustainability mandates is reshaping power procurement strategies.

• AI-driven infrastructure modernization demands higher power density capabilities, expanding the market share.

• Data localization regulations compel multinational corporations to establish local operations, boosting demand for enterprise-grade power infrastructure.

• Exponential capacity growth in data centers projected to increase electricity consumption and incentivize renewable sourcing.

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MARKET TRENDS

Government Policy Support and Infrastructure Status Driving Market Expansion

The Indian government has positioned the country as a global data center hub through comprehensive policy frameworks, including the designation of data centers as infrastructure in the 2022-23 budget. This policy unlocked institutional financing avenues allowing long-term capital access at favorable rates for power deployments. State-level policies in Maharashtra, Tamil Nadu, Karnataka, and Telangana offer fiscal incentives such as reduced power tariffs and land subsidies, speeding up project timelines. The IndiaAI Mission’s Rs 103 billion funding targets AI-ready data centers, boosting demand for uninterruptible power supplies and intelligent power distribution. In January 2025, Telangana’s INR 24,500 Crore investment for AI-optimized data centers totaling 550MW capacity underlines this policy impact.

Rising Demand for Renewable Energy Integration and Sustainability Mandates

India’s data center capacity is expected to grow from 1.4 GW in 2024 to 9 GW by 2030, elevating electricity consumption to roughly 3% of the nation’s total demand. This growth coupled with state mandates in Maharashtra and Tamil Nadu requiring up to 100% renewable sourcing, compels operators to adopt hybrid solar-plus-storage systems. Renewable power tariffs reaching historic lows of Rs 4.98-4.99 per unit, undercutting natural gas generation at Rs 5.4 per unit, favor clean energy. Bharti Airtel’s Nxtra committed to 140 GWh renewable power annually via 72.3 MWdc captive solar and wind projects under 25-year agreements, exemplifying this shift.

AI-Driven Infrastructure Modernization and Power Density Requirements

AI workloads demand rack power densities escalating from 8-10 kW per rack to 30 kW or more, with some hyperscale facilities targeting loads above 40 kW per rack. This increase requires upgrades spanning utility interconnections to intelligent power distribution units with circuit-level monitoring. Cooling technologies including liquid immersion cooling are explored to manage thermal loads efficiently. Vertiv’s December 2024 launch of the PowerUPS 9000 offers 250 to 1250 kW capacity UPS systems for high-density environments. The shift encourages modular power infrastructure scaling and stringent power quality with double-conversion UPS and N+1 generator redundancies.

MARKET GROWTH FACTORS

Government Stimulus and Financial Incentives

Government designation of data centers as infrastructure has unlocked institutional financing with favorable terms, enabling operators to deploy critical power infrastructure efficiently. State-specific fiscal incentives such as reduced tariffs and land subsidies in Maharashtra, Tamil Nadu, Karnataka, and Telangana have shortened approval cycles and created predictable investment climates. The IndiaAI Mission’s Rs 103 billion funding to support AI-optimized data centers and data localization laws fortify investments in high-grade power systems.

Renewable Energy Integration and Economic Viability

The exponential capacity increase leading to data centers consuming approximately 3% of India’s power by 2030 has prompted a clean energy focus. Renewable tariffs as low as Rs 4.98-4.99 per unit provide cost advantages over traditional generation options. Bharti Airtel’s Nxtra renewable procurement of 140 GWh and operators’ investments in captive renewable projects ensure price stability and sustainability compliance, fostering growth in intelligent PDUs, modular UPS, and energy storage solutions.

AI-Focused Infrastructure Modernization

Rising AI workloads with power densities up to 30-40 kW per rack drive demand for advanced power systems capable of stringent quality and uninterrupted supply. Modular, scalable infrastructure avoids over-provisioning. Cooling innovations improve energy efficiency. Recent product launches like Vertiv’s PowerUPS 9000 address these demands, allowing operators to sustain growing AI computation needs while maintaining power reliability and scaling flexibility.

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MARKET SEGMENTATION

Solution Type Insights:

• Power Distribution and Measurement: Includes intelligent PDUs, non-intelligent PDUs, and monitoring software, essential for dynamic load management and power monitoring.

• Power Backup: Comprises UPS devices and generators providing uninterrupted power supply and backup generation.

• Cabling Infrastructure: Encompasses transfer switches and switchgear required for power routing and safety.

Service Type Insights:

• System Integration: Services that consolidate various power solutions into a cohesive operational system.

• Training and Consulting: Support services providing expertise development and strategic advice.

• Support and Maintenance: Ongoing services ensuring power infrastructure reliability and performance.

Size Insights:

• Mid-size Data Center: Facilities smaller than enterprise scale requiring tailored power solutions.

• Enterprise Data Center: Large-scale data center operations serving extensive organizational IT needs.

• Large Data Center: Hyperscale or highly dense facilities with advanced power requirements.

Vertical Insights:

• BFSI: Banking, Financial Services and Insurance sector using data centers for critical operations.

• Telecommunication and IT: Providers relying on data centers for connectivity and IT services.

• Energy: Energy sector players utilizing data centers for operational efficiency.

• Manufacturing: Industrial companies adopting data center power infrastructure.

• Others: Other industries engaging data center power services.

Regional Insights:

• North India

• South India

• East India

• West India

REGIONAL INSIGHTS

South India emerges as a dominant region owing to significant investments and policy support fostering the development of AI-optimized data centers. Telangana’s INR 24,500 Crores investment for 550MW AI-ready data centers highlights this. Regional policies offering fiscal incentives and renewable mandates further strengthen South India’s share and growth prospects in the India data center power market.

RECENT DEVELOPMENTS & NEWS

In October 2025, Google announced a USD 15 Billion investment in new data centers and digital infrastructure in Andhra Pradesh. The company plans to collaborate with AdaniConneX and Airtel to develop an AI hub in Visakhapatnam, positioning the city as an AI and connectivity center with subsea cable gateway and clean energy infrastructure. This strategic move supports the rising demand for AI-ready data centers and enhanced power infrastructure in India.

KEY PLAYERS

• Not provided in source.

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