Business News | Supply-chain Constraints May Cap India's Data Centre Capacity at 3 GW by 2030: Report

New Delhi, [India] August 3 (ANI): Execution bottlenecks and supply-chain constraints could significantly slow India's data centre (DC) capacity expansion, limiting operational capacity to around 3 gigawatts (GW) by 2030 despite industry announcements targeting more than 6 GW, according to an Axis Capital report.

The report noted that while India's installed data centre capacity currently stands at around 1.4 GW, publicly announced expansion plans appear overly optimistic in view of execution challenges.

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"Publicly-announced capacity targets of 6-8GW by 2030 look inflated; the expert's realistic estimate is 3.4-3.6GW cumulative operational DC capacity by mid-2030. On a more conservative basis... only ~2.8GW is likely to actually be operational by then given execution constraints," the report said.

According to the report, the biggest hurdles are bottlenecks in the mechanical, electrical and plumbing (MEP) supply chain, limited availability of critical equipment and skilled manpower, and delays in obtaining power connections.

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It said award-to-commissioning timelines typically stretch to 28-36 months, while supply constraints have worsened as multiple developers execute projects simultaneously.

"DG gensets effectively limited to three global brands (Caterpillar, Cummins, MTU) are usable for hyperscaler-grade builds, and all three are already booked out roughly two years ahead given how many players are building simultaneously," the report said.

Besides equipment shortages, EPC contractor capacity, manpower availability and power sanction timelines of around 18 months are also emerging as major constraints, the report added.

The report further noted that India's preference for vertical data centre construction due to land and floor space constraints makes projects more complex and lengthens execution timelines compared with horizontal facilities built in overseas markets.

Despite the near-term challenges, the long-term outlook remains positive. The report said India's data centre industry could witness a sharp increase in capacity over the following five years if currently announced projects are executed as planned.

"The expert sees potential for 7-8 GW of capacity by 2035, if currently announced projects materialize in full, though in the nearer term, a more realistic 2030 operational estimate remains closer to ~3 GW," the report added. (ANI)

(The above story is verified and authored by ANI staff, ANI is South Asia's leading multimedia news agency with over 100 bureaus in India, South Asia and across the globe. ANI brings the latest news on Politics and Current Affairs in India & around the World, Sports, Health, Fitness, Entertainment, & News. The views appearing in the above post do not reflect the opinions of LatestLY)