Water for Vizag Data Centres not at the Cost of City’s needs: Data Centres and Water Security 

Why in News?

The Andhra Pradesh state government has stated that water required for the proposed 6.5-GW data-centre ecosystem in Visakhapatnam will be supplied from the industrial allocation of the Polavaram project through dedicated pipelines, without affecting drinking-water and irrigation requirements.

The development assumes significance as Google has begun constructing a $15-billion, gigawatt-scale AI hub in Visakhapatnam. 

Data Centres:

• Data centres are specialised facilities that store, process, and manage digital information, forming the backbone of cloud computing, artificial intelligence (AI), fintech, e-commerce, and digital governance. 
•  Driven by AI adoption, cloud expansion, and data localisation requirements, India’s data centre industry is growing steadily. Total data centre capacity in the country has increased from about 375 MW in 2020 to around 1500 MW by 2025.

Why do Data Centres require water?

• Data centres generate enormous heat while operating servers continuously. Water is commonly used in cooling towers, where evaporation removes this heat. Additional (indirect) water is consumed in producing the electricity that powers the centres.

The State estimates that the proposed facilities will require around 3 thousand million cubic feet (TMC) annually (approximately 85 billion litres a year or 233 million litres per day). Actual consumption will depend on climatic conditions, computing intensity and the cooling technology adopted.

Economic Significance: 

A data-centre cluster can:

• strengthen India’s cloud-computing and artificial-intelligence capacity;
• support data localisation and digital sovereignty;
• attract investments in chips, cooling equipment, transformers and power electronics;
• leverage Visakhapatnam’s submarine-cable and port connectivity; and
• create an ecosystem encompassing logistics, construction and maintenance services.

Associated Constraints: 

• Water scarcity: Conventional data centres require massive amounts of water for cooling. Sourcing this water in water-stressed urban regions creates severe environmental challenges. Industrial allocation may compete with domestic consumption and irrigation during drought years. 
• Power-grid stress: Data centres require continuous, high-quality electricity. Spatial concentration of several gigawatt-scale facilities can strain local generation, transmission infrastructure and distribution utilities. 
• Land and capital intensity: Data centres require large, secure and contiguous land parcels situated close to reliable electricity, fibre networks and cable-landing stations. This can considerably raise investment requirements and requires steep capital expenditure.
• Fragmented regulation: India’s national Data Centre Policy, released in draft form in 2020, coexists with different State policies and approval systems. Investors may consequently face varying rules concerning land use, electricity tariffs, environmental clearances and fiscal incentives. 
• Fibre connectivity and RoW: Optical-fibre deployment may face delays involving municipal, railway, highway and other land-owning authorities. The Telecommunications (Right of Way) Rules, 2024 seek to standardise and digitise permissions, but effective implementation by different authorities remains crucial.  

Way Forward: 

• Use treated municipal wastewater rather than freshwater for cooling.
• Mandate disclosure of Water Usage Effectiveness and Power Usage Effectiveness.
• Promote closed-loop, direct-to-chip liquid immersion and climate-appropriate air-cooling technologies.
• Introduce seasonal water limits and drought-contingency provisions, with drinking water receiving priority.
• Conduct cumulative water, energy and environmental assessments for the entire cluster.
• Require additional renewable-energy capacity, storage and grid upgrades alongside data-centre expansion.
• Ensure transparent disclosure of industrial water allocations and independent monitoring.

Visakhapatnam can emerge as a major AI and digital-infrastructure hub, but dedicated pipelines alone cannot resolve the underlying sustainability challenge. 

Development must be based on transparent water allocation, ecological-flow protection, grid augmentation and resource-efficient technology to ensure that digital growth does not compromise the water and energy security of local communities.