Renewable Energy Procurement Strategies for Data Center Operators in India

VMPL
New Delhi [India], November 5: Every online search, video call and digital payment relies on data centers to process information. These facilities operate around the clock and need a reliable supply of electricity. As data center companies in India grow, operators face two key concerns: managing power costs and meeting clients' expectations for cleaner energy.
Choosing the right power procurement strategy can help operators address both. By purchasing renewable electricity through suitable arrangements, they can reduce their dependence on conventional power and work towards their sustainability goals.
Why Renewable Energy Matters for Data Centers in India
India's data center capacity is growing, increasing the need for a reliable electricity supply. The country added about 130 MW of data center capacity in the first half of 2026, taking operational capacity close to 2 GW.
Data center companies in India currently account for about 0.5% of India's total electricity consumption. Their share could rise as more facilities become operational.
Two factors make data center renewable energy an important consideration for operators:
- Power costs: Electricity is a major operating expense for data centers. Renewable power procurement can help manage these costs, depending on the tariff and additional charges.
- Client expectations: Technology companies that use data center services may require their providers to report emissions and increase the use of renewable electricity.
A suitable energy strategy can help operators manage expenses while meeting their clients' sustainability requirements.
How Data Center Operators Can Procure Renewable Energy
Operators can choose from several procurement models based on their location, electricity needs and budget.
1. Open Access
Under renewable energy open access, a data center operator procures electricity from a renewable energy generator and uses the electricity grid to deliver the contracted power to its facility, subject to applicable regulations and scheduling arrangements. India's Green Energy Open Access Rules allow eligible consumers with a connected load of 100 kW or more to access this arrangement, subject to applicable conditions.
This option allows operators to source power directly from data center renewable energy developers instead of relying entirely on their usual electricity supplier. However, state regulations, grid charges and approval requirements can affect the final cost.
2. Group Captive Power
Under a group captive arrangement, the consumer holds an ownership stake in a renewable power project and uses the electricity generated by it. This model may offer cost benefits when the ownership and consumption requirements are met.
Data center operators should assess the investment required, applicable regulations and long-term electricity demand before choosing this route.
3. Round-the-Clock Renewable Power
Data centers need electricity throughout the day and night. Solar power alone cannot meet this demand because generation falls after sunset. Round-the-clock renewable power arrangements combine sources such as solar and wind with battery storage or other suitable solutions to provide a more consistent supply.
In August 2026, a Solar Energy Corporation of India tender for 1 GW of firm, round-the-clock renewable power discovered a tariff of ₹5.25 per unit.
This provides an example of how firm renewable power is being procured in India. The tariff available to an individual data center will depend on its contract and other applicable costs.
4. Onsite Solar Power
Operators can install solar panels on available rooftops or land near their facilities. Onsite solar can supply part of the electricity required during daylight hours and reduce the amount purchased from the grid.
However, the amount generated depends on available space, weather conditions and system capacity. Operators will generally need additional power sources to meet demand when solar generation is low.
What to Look for in a Renewable Energy Partner
Selecting a suitable power supplier is an important part of the procurement process. Data center operators should assess the supplier's ability to meet their energy requirements over the long term.
Key considerations include:
- Project experience: Check the supplier's experience in developing and operating data center renewable energy projects.
- Reliable supply: Assess whether the supplier can support electricity demand throughout the day and night.
- Storage solutions: Understand how battery storage or other technologies will help manage changes in renewable power generation.
- Regulatory support: Review the supplier's experience with open access applications, grid approvals and state-level requirements.
- Project readiness: Check land availability, grid connectivity and project timelines before entering into a supply agreement.
Companies such as Avaada Group work across renewable energy generation and storage, including solar, wind and firm renewable power solutions. For data center operators, working with a supplier that can coordinate generation and storage may simplify procurement.
Operators should still assess the proposed project's status, delivery schedule, pricing and contractual commitments before making a decision.
India's Growing Renewable Energy Capacity
India's expanding renewable energy capacity gives data center operators more options for sourcing cleaner electricity. As of September 30, 2026, India’s total installed non-fossil fuel power capacity reached 308.03 GW (308,027 MW), accounting for 55.11% of the country's total installed power capacity.
This growth can support businesses looking to increase their use of renewable electricity. However, installed capacity does not mean that renewable power is available at every location or at every hour.
Green energy data center operators may therefore combine different procurement methods. For example, onsite solar can meet part of the daytime demand, while open access agreements and grid electricity cover other requirements. Storage and firm renewable power contracts can help address periods when renewable generation is lower.
The right combination depends on the facility's load profile, location, budget and reliability requirements.
Final Thoughts
Renewable energy procurement is an important business decision for green energy data center operators in India. Open access, group captive projects, round-the-clock renewable power and onsite solar offer different ways to meet electricity needs and manage emissions.
For facilities that operate continuously, reliable power supply must remain a priority alongside cost and sustainability. Combining renewable generation with suitable storage and grid support can help operators meet these requirements. Working with leading renewable energy companies like Avaada Group can also help data center operators explore suitable clean energy solutions. By assessing their energy demand, local regulations and potential suppliers, data center companies in India can choose a procurement strategy that supports their long-term operating needs.
(ADVERTORIAL DISCLAIMER: The above press release has been provided by VMPL. ANI will not be responsible in any way for the content of the same.)