Energy News Monitor, Volume XVII; Issue 40

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Energy News Monitor, Volume XVII; Issue 40

14 Apr 2021

In 2005, approximately 80 percent of Indian websites were hosted in data centres outside India primarily because power supply was unreliable to set up data-centres. In the early 2010s, increase in broadband and 4G use coupled with the quick adoption of cloud services initiated a demand for data-centres in India. In 2020, the exponential growth in e-commerce, digitisation of banking and finance, digital entertainment and the use of social media through over 700 million mobile phones enhanced the demand for data-centres closer to users. In addition, the government’s increasing reliance on data centres for the government-to-citizen (G2C) delivery platforms, such as the national e-governance plan (NeGP), e-visa, and national CSR data portal increased the need for India based data centres. More importantly, the proposed rules for data localisation and the steps to ensure data sovereignty under the draft personal data protection bill introduced in 2020 by the ministry of electronics & information technology (e-commerce division), government of India, increased the need for local data centres. Under the proposed rules, data generated in India must be stored within India, protecting personal and financial data from foreign surveillance. Cross-border transfer of critical data is prohibited under the proposed rules. In India data centres are operated as captive centres (company owned) or third-party co-location centres (service provided for other businesses). With the expected implementation of data localisation norms third-party data centres in India are expected to move from the current capacity of over 590 MW (megawatt) to about 2,000 MW in the next 2-3 years. Data centres are classified as an essential service and were allowed to operate even throughout the strictest lockdown periods in India. India’s share of the global data centre market is about at 2 percent but it is projected to double in the future. China’s data centre market is growing at least 4 to 5 times faster than the Indian market. At present, data centre capacity is low in India at less than 1 MW/million internet users compared to 8 MW/million internet users in the USA and 21 MW/million internet users in Europe. But data tariff in India is among the lowest in the world at $0.26/GB (gigabyte) compared to about $12/GB in the USA and $8.5/GB global average. Majority of the data centres in India are in the Tier 3 category with 99.982 percent guaranteed uptime availability, with around 25 percent of the capacity operating at Tier 4 with 99.995 percent availability.
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