India’s data centre market has demonstrated substantial growth in investments and capacity in recent years. Within the segment, two concepts that have gained significant attention are edge data centres and sustainability. Although these are completely different concepts, they are now being increasingly converged to explore the possibility of supporting the growing digital landscape through an environmentally conscious approach. A look at the growing relevance of edge computing and sustainability in the data centre space and the convergence of the two…
Rise of edge data centres
Edge data centres are small, purpose-built facilities located close to the end user. They offer increased capacity, lower latency and reduced network costs. They also have high redundancy due to the presence of a large number of small facilities and significantly faster internet speeds.
As per industry reports, the global edge data centre market was valued at $8 billion in 2022. It is expected to grow at a compound annual growth rate of around 26 per cent between 2023 and 2035 to reach $67 billion. The growth is driven by multiple factors. According to Gartner, by 2025, 75 per cent of all enterprise data will be created and processed outside a traditional centralised data centre or cloud, that is, at the edge. Further, the widespread adoption of the 5G network and its various use cases entails a high density of devices. To meet the demand for lower latency, decentralised cell networks comprising edge data centres have become crucial. Another contributing factor is the increased uptake of internet of things (IoT), augmented reality/virtual reality, video streaming and metaverse. These technologies generate large volumes of data and require low-latency edge processing close to end-users, ultimately driving the growth of edge data centres.
Recent deployments
Several companies have started exploring opportunities in the Indian edge data centre market. Bharti Airtel’s subsidiary Nxtra currently has a footprint of over 120 edge data centre sites spread across around 65 cities. These data centres have 26,000 racks and 50 MW of power output. RailTel, a central PSU, recently announced its plans to establish 102 edge data centres on railway premises, especially in Tier II and Tier III towns. This would entail an investment opportunity of around Rs 5 billion. Further, NxtGenDatacenter and Cloud Technologies announced an investment of Rs 13 billion to set up 236 edge data centres in India by the first quarter of 2022-23. The company already has four edge data centres in Faridabad, Mumbai, Bengaluru and Ahmedabad, and is looking to develop new facilities in Hyderabad, Visakhapatnam and Chennai. Recently, Varanium Cloud launched its second edge data centre in Kudal, Maharashtra, following the launch of the first in Goa last December. Metaedge also announced its plans to set up over 70 edge data centres throughout India.
Sustainability takes centre stage
Data centres are energy-intensive facilities. For context, a hyperscale data centre can use as much power as 80,000 households. The International Energy Agency estimates that data centres account for around 1 per cent of the global electricity demand. They have the fastest-growing carbon footprint in any segment within the IT sector, collectively accounting for 3-4 per cent of greenhouse gas emissions globally.
To this end, sustainability is among the topmost priorities for data centre players. A number of data centre providers are making efforts to reduce demand for fossil fuels by meeting 100 per cent of their annual electricity consumption with renewable energy purchases. Hyperscalers have started to fund renewable energy plants in the face of supply shortages and soaring fossil fuel prices. There is a shift towards green data centres, which are designed for maximum efficiency and minimum environmental impact by recycling and reusing water, substituting conventional power with renewable energy sources and managing e-waste in an environmentally safe manner. Further, modern data centres are deploying new-age technologies such as artificial intelligence (AI), machine learning (ML), automation and IoT to build lean and smart facilities. AI can predict power outages, reduce maintenance costs and achieve higher performance metrics. These technologies also allow real-time control of cooling equipment, which can help save up to 40 per cent of the power spent on data centre cooling. A Gartner report states that by 2025, half of the cloud data centres will deploy advanced robots with AI/ML capabilities, resulting in 30 per cent higher operating efficiency.
Owing to initiatives such as energy efficiency improvements, renewable energy procurement and the decarbonisation of electricity grids in various regions, emissions related to digital services have experienced only modest growth since 2010. However, recent data from Uptime Institute Intelligence shows that progress in power usage effectiveness (PUE) has stagnated over the past few years. The average annual PUE reported in 2022 was 1.55, a marginal improvement over the 2021 average of 1.57.
Key initiatives
In the draft Data Centre Policy, the Ministry of Electronics and Information Technology has encouraged the use of renewable energy for data centres by collaborating with the Ministry of Power on their various green and sustainable energy initiatives. The draft policy also mentions adopting established global standards for data centres and data centre parks. Meanwhile, several data centre providers in India have undertaken initiatives towards sustainability.
Bharti Airtel’s subsidiary, Nxtra Data Limited, has partnered with Bloom Energy to deploy low-environmental-impact fuel cells at its data centre in Karnataka. With this, it has become the first data centre company in India to deploy fuel cell technology to reduce carbon emissions at its data centres while unlocking cost and sustainability benefits. In 2021, the company also commissioned a 14 MWp captive solar power plant to meet the energy requirements of its core and edge data centres in Uttar Pradesh. Earlier, Nxtra had signed a power purchase agreement (PPA) for sourcing electricity from a 9 MW hydropower plant for its data centres in Delhi, and partnered with Avaada Energy to source solar power from 65 MW of solar PV assets.
Meanwhile, Sify Technologies Limited has concluded PPAs with Vibrant Energy Holdings for 231 MW of solar and wind energy capacity to power its latest hyperscale data centres. Hyderabad-based CtrlS has installed a building-integrated solar plant at its Mumbai data centre, generating 1.8 MUs of power per year and offsetting 620 tonnes of CO2 emissions annually. Global data centre player NTT is rapidly expanding its renewable energy capacity to meet the power needs of its growing data centre operations. Its first 50 MW captive solar power plant was set up at Solapur, Maharashtra, in collaboration with Tata Power Renewable Energy Company. It caters to the energy needs of its Mumbai data centres. In October 2022, PhonePe launched its first green data centre in India. The 4.8 MW facility in Navi Mumbai is designed with advanced alternative cooling technologies such as direct contact liquid cooling and liquid immersion cooling.
Sustainability at the edge
The data centre industry is considering the integration of edge data centres and sustainability measures to achieve two key objectives — meeting the growing demand for computing while minimising the carbon footprint. Edge computing stores and processes data closer to its origin, reducing the need for extensive data transfers to the cloud. This approach has a significant impact on energy consumption and carbon emissions. By reducing data overhead and unnecessary data traversals, it is possible to achieve a substantial reduction of 60-90 per cent in data traffic, thereby reducing the carbon footprint and the cost of an application. Moreover, edge data centres do not need concentrated loads and can be integrated with the existing residential/industrial grid or renewable energy sources. Smaller edge data centres may even require less passive energy for cooling and ventilation. Therefore, edge data centres are more sustainable compared to traditional or hyperscale data centres.
Future outlook
India is witnessing an uptick in the deployment of edge data centres by domestic and global players. Meanwhile, data centre sustainability has become a top priority as operators lead innovative initiatives to achieve their net zero targets. Together, these investments and initiatives will help build a more resilient and greener future for the industry.
Sarah Khan
