Why Switching to Solar power makes sense for Data Centers in Uttar Pradesh, Maharashtra

Solar Power is increasingly becoming a source of electricity cost-control for data centers. It is already fast emerging as the preferred option to power up data centres for Indian telcos(1).  In 2021, Airtel commissioned a 14 MWp captive solar power plant to meet the energy requirements of its core and edge data centres in Uttar Pradesh (2).  There is also news reports that, Reliance Jio Infocomm Ltd, India’s largest wireless operator, is also planning to build a solar powered data centre in Uttar Pradesh at an investment of around $950 million. Adani Enterprises Ltd has also partnered EdgeConneX, to develop 1 gigawatt (GW) of data centre capacity that will be powered by renewable energy.

Why Switching to Solar power makes Sense for Data Centers ?

Data Centres, which play a key role in the digital ecosystem, have large power requirements. Considering the example of airtel, the 14 MWp of solar power plant will generate about 20 million units of electricity (KWhr) annually. Airtel is procuring this solar power on Captive model, where airtel has acquired 26% stake in Special Purpose Vehicle (SPV) created for this Solar Power. The Solar Power plant is funded, operated & managed by a third-party solution provider and Airtel will pay a discounted tariff for using these generated units.

This will allow Airtel to have cheaper & renewable solar power at a heavy discounted investment, with no liability to run the solar power plant. Airtel will just procure the units and pay the discounted tariff.  The whole arrangement working on a PPA based model.

The PPA model allows businesses such as data-centers to focus & scale on their business, while renewable power like solar is provided through a specialised solar company. 

So why does it make, special sense in Uttar Pradesh & Maharashtra ?

Electricity, along with petrol & diesel is one of the last remanents of license raj, is subjected to variety of duties & taxes that very across the states. Consequently, there are certain states where policies, help businesses switch to solar by making them profitable for innovative business models like PPA. In 2021, consider the overall dynamics of policies across the country, the states of Uttar Pradesh & Maharashtra come out as winners for Open Access Solar Power solutions based on Captive Power mode.

This is guest post by Yellow Haze Solar. Yellow Haze provides both roof-top & open-access solar power solutions under various financial models. Drop a message at info@yellowhaze.com or call +91-9462878912