Data centre operators are turning to India's renewable energy providers as a potential growth avenue, with mounting scrutiny in the United States and instability tied to the Middle East conflict prompting companies to explore alternative supply markets.

Kuldeep Jain, founder and chief executive of CleanMax Enviro Energy Solutions Ltd., a renewables firm operating in India, said in an interview in Mumbai that the volume of clean power required to support artificial intelligence infrastructure is far less understood than it should be. He added that even a modest influx of five gigawatts of data centre capacity into the country would translate into a demand for roughly 30 to 40 gigawatts of renewable electricity — a level at which demand would outpace available supply. The government has been introducing a range of incentives for data centre operators, including subsidised power tariffs, tax relief, and streamlined land approvals.

BloombergNEF data place the nation ahead of all other Asia-Pacific destinations for data centre investment and construction activity, with only China drawing a larger share of regional development. BloombergNEF data also show that India already has data centre projects totalling 1.3 gigawatts of IT capacity actively under development, with a further 3.2 gigawatts of development capacity having cleared the three key hurdles of site access, grid connection, and regulatory approval.

Jain noted that opposition from US communities to the heavy energy and water demands of such facilities, combined with instability stemming from the ongoing tensions across the Middle East, had strengthened the country's draw for those companies. A pair of Amazon's Bahrain-based data centres sustained damage following an attack attributed to Iran in July.

Jain noted that channelling funds into renewable energy infrastructure and storage capacity at the pace required would demand investment running into the billions. Backed by Brookfield Asset Management and holding supply agreements with AI hyperscalers — operators of large-scale global data-centre networks, including Meta Platforms Inc., Alphabet Inc.'s Google, Apple Inc., and Amazon.com Inc. — CleanMax carries contracted capacity of 1.8 gigawatts, a figure that accounts for close to one-third of all such arrangements concluded in India across the preceding three years.

Jain placed annual capacity additions at around 1.5 gigawatts of solar and wind, underpinned by capital expenditure of up to Rs 9,000 crore ($950 million). He outlined the infrastructure demands of a one-gigawatt AI data centre running at 75 per cent renewables — a configuration that would draw on roughly three gigawatts each of solar and wind generation together with approximately three gigawatt-hours of storage, with the renewables-side build-out alone carrying a capital requirement of around Rs 40,000 crore ($4.8 billion).

Jain noted that large-scale cloud and AI operators are gravitating toward power agreements structured around optionality — arrangements that allow them to purchase only the environmental certificates tied to a renewable project, offsetting their emissions footprint without requiring any physical electricity to flow to their sites. He added that these buyers can either route power directly to their data centres or ask the seller to offload it on exchanges, with the difference between the guaranteed tariff and the exchange realisation settled separately, a structure that the majority of those operators have chosen to retain.

According to projections from Wood Mackenzie, total capacity could reach 12 gigawatts by 2030, with the portion dedicated to AI-driven data centres climbing from a comparatively modest base to 6.5 gigawatts — a roughly 24-fold expansion.