Techno Digital, a new venture from the well-established Techno Electric & Engineering Co. Ltd, is making a significant mark in India’s booming digital infrastructure sector with a $1 billion investment. Leveraging its parent company’s deep expertise in power infrastructure, Techno Digital aims to differentiate itself in the competitive hyperscale and edge data centre market. In this interview, Amit Agrawal, President, Techno Digital, sheds light on the strategic decisions driving this ambitious expansion, their innovative approach to sustainability, and their vision for contributing to India’s digital future, particularly in tier-two and tier-three cities.
Techno Electric’s foray into digital infrastructure with a $1 billion investment signals a bold ambition in the hyperscale and edge data centre space. What drove this strategic move for Techno Electric, and how does Techno Digital plan to differentiate itself in a market already experiencing significant activity from established players?
That’s a great question, as it’s something that constantly drives us as well: how to differentiate ourselves to gain market share in this highly competitive business. Luckily for us, the data centre growth is evolving in a very unconventional way. Traditionally, data centre growth was driven by two main factors: hyper-digitisation in India and the arrival of hyperscalers, with requirements largely dictated by these hyperscalers. Consequently, most data centres were built to cater to those specific demands.
However, in the last two years, things have drastically changed. There’s an unconventional growth driven, of course, by artificial intelligence and the resulting GPU workload. It’s no longer traditional workloads driving this growth, which necessitates a lot of innovation in data centres. Previously, increasing power densities within racks was often a hit-and-trial method—adding rear door heat exchangers, moving to liquid cooling, or direct liquid cooling. But no data centre was purpose-built to suit AI requirements or high workloads. Parameters like data centre efficiencies, carbon credit generation, and water utilisation efficiency with high workloads were largely absent in the traditional data centre space, which is what we’re aiming to bring in.
This is possible only because of our strong legacy in the power sector. Our parent organisation, Techno Electric, has been in power infrastructure for 40 years, contributing significantly to India’s power grid. We proudly state that almost 50% of the power grid substations have seen some contribution from our side, whether we built, subcontracted, or maintained them. Our association with power infrastructure is very deep. We wanted to move into where this power is actually being utilised. We had experience in power generation (operating over 250 MW of renewable power plants in southern states) and power distribution/transmission at the grid level. Now, we want to understand and help industries where power is highly consumed, and data centres top that list as power guzzlers. That’s where we wanted to leverage our experience. We’re bringing this innovation and our understanding of power, which is the main ingredient in the data centre industry today.
Additionally, as things unfolded, we partnered with RailTel to set up edge data centres. This resolved the missing piece of connectivity, IT prudence, and IT innovation in our story. RailTel was seeking a partner for edge data centres in tier-two and tier-three cities, and they had an interconnected network.So, our story is now complete: we’re bringing power innovation not only to top-tier cities but also to tier-two and tier-three cities, where significant consumption and innovation are happening, all interconnected through RailTel’s optical fiber network. This creates a very strong differentiator and value proposition for us in the data centre space.
Your model blends both hyperscale and edge deployments across metro and non-metro regions. How do you envision the operational interplay between these two, and what specific sectors or applications are you targeting in tier-two and tier-three cities?
Right now, tier-two cities primarily see specific workloads related to their internal IT consumption, which is a very minuscule part. However, the growth will be driven by governance and the data generation in these cities. We’re all talking about inferencing and artificial intelligence. When training an AI model, you require diverse data from various parts of the country. One approach is to centralise all data for training. For instance, as India attempts to build its own Large Language Models (LLMs) and intelligent models, the training will require data from these tier-two and tier-three cities. So, a major use case for edge data centres will be GPU training for AI models utilising local data.
Second is the local governance aspect. India currently has over 100 smart cities.Frankly, we’ve probably only realised 50% of the true benefits from these smart city projects. While certain applications were driven and enforced, the full benefit needs further demonstration. This can only happen when data resides locally, allowing for the identification of trends unique to a specific city or environment, and then implementing governance accordingly.
Third, local industries are developing, and there’s a strong focus on innovation in smaller cities, often driven by educational institutes. We have no shortage of talent in these tier-two and tier-three cities. The only missing piece was the unavailability of infrastructure, which we aim to solve. This will allow local educational institutes to contribute to the growth and innovation from these class-two and class-three cities.
Fourth, traditional enterprise workloads are maturing and now require a facility that is more data-centric rather than just an IT support system. These are the four fundamental parameters we are focusing on for use cases in these edge data centres.
Techno Digital is experimenting with advanced sustainable cooling techniques, including greywater reuse and liquid cooling. Could you elaborate on how these innovations have been deployed at your Chennai facility and what measurable impact they’ve had on energy efficiency and water usage?
There are two fundamental ways to measure effectiveness. The first is Power Utilisation Effectiveness (PUE), which is the ultimate output for measuring all efficiencies built into data centres. Our design PUE is approximately 1.35, which is one of the best in the industry, achieved without specific additional cooling like Direct Liquid Cooling (DLC).We were able to envision this because we have global consultants advising us on future trends.
One very unique thing we’ve implemented in our data centre, which isn’t commonly prevalent today, is hot aisle containment. Most data centres you’d visit or have spoken about contain cold aisles because cooling needs to be contained. While important for basic loads and lower temperature requirements (typically 19-21°C), today’s electronics can support temperatures up to 30-35°C, and GPUs operate at 60-70°C. There’s no point in inefficiently cooling a data centre to 19°C. Our new technology, hot aisle containment, contains the generated heat, reprocesses it, and maintains a very basic ambient temperature in the overall infrastructure for cooling.
Second, most traditional data centres use air-cooled chiller systems. While there’s debate, water-based chillers are more efficient and significantly bring down PUE. The challenge with water-based chillers is water usage, especially in places like Chennai, where water is precious despite being near the sea. When using a water-based chiller, sensitivity to water utilisation efficiency is crucial. We use adiabatic cooling, the most advanced and closed-loop cooling method, which greatly reduces water’s exposure to the atmosphere. This significantly reduces water utilisation, allowing us to maintain one of the best water utilisation efficiencies in the industry.
These two parameters, using water-based chillers to bring down our PUE and closed-loop adiabatic cooling towers for water utilisation efficiency, allow us to offer benefits to customers without compromising on water. This also provides higher capacity utilisation within the rack in a traditional form. While most current data centres support an average density of 5 to 6 kW per rack (for which they were designed over the last 4-5 years), our data centre, without any changes, can support a minimum average density of 10 kW per rack, which is almost 60% higher than traditional data centres. The efficient methods that others would use to increase capacity by 60% are already part of our basic design. Any additional measures will further increase our capacity from 10 kW to potentially 120-130 kW per rack, which we’ve theoretically worked out with some prospective customers.
Is hot air containment a commonly used technique in Indian data centres, or is this something unique that Techno Digital is pioneering?
In India, this will probably be the first time that hot aisle containment is being used. However, most of the newest data centres that are now coming up will likely adopt hot aisle containment. So, we’ll see this become more prevalent in new greenfield data centres.
ESG and sustainability disclosure are increasingly critical, especially in energy-intensive sectors like data centres. How are you aligning with upcoming Indian and global regulations on carbon emissions, water use, and e-waste?
Firstly, we are putting a lot of effort into having a proper ESG framework in place. Data centres have unfortunately earned a reputation as “power guzzlers,” so ESG initiatives are paramount for everyone. From the design stage, we were very clear about pursuing LEED Gold certification from the US Green Building Council (USGBC) for our site. This international certification covers all parameters related to our ESG initiatives.
Secondly, norms require leaving 25% of the area as a green space. Today, considering project modularity, some operators are reluctant to allocate non-utilised green spaces. However, we made a conscious effort to dedicate 25% of our area to greenery. This not only enhances aesthetics and maintains ambient temperature but also contributes to our ESG certification.
Thirdly, one crucial aspect we’re working on is passing on carbon credits to our customers, something no other data centre in India has done yet. Because we come from a power background, we have a sister concern, Techno Green, which is into green power and battery storage solutions, and is registered with the UNFCCC (United Nations Framework Convention on Climate Change). Whenever they set up renewable power plants, they pass on carbon credits to their customers. We plan to extend this to our data centre operations. With our UNFCCC-certified sister concern, we’ll be able to pass on power benefits, including carbon credits, not only to ourselves but also to our bulk power customers. This commitment to designing, operating, and sharing benefits will keep us focused on our sustainability initiatives.
Techno Digital has a goal to build 250 MW of capacity. What are some key milestones planned for the next couple of years, and how are you balancing speed of deployment with factors like grid reliability, land acquisition, and talent availability in emerging regions?
There are two parts to this: our project capability or EPC (Engineering, Procurement, and Construction) capability, and the geographical diversity we’re working on. Currently, we’re working on seven different projects simultaneously. Our Chennai project is nearing completion, we’ve recently completed an Edge Data Centre in Gurgaon, and work has begun on an Edge Data Centre in Mumbai. We’ve finalised lands in Indore and Gandhinagar, and our large enterprise data centre in Kolkata has already started. We’ll soon begin work on our Noida data centre where we’ve acquired land.
Managing seven simultaneous projects as a new data centre operator is challenging, requiring extreme caution in project and resource management across financial, manpower, and technology aspects. However, our EPC expertise from power infrastructure projects, where we simultaneously managed 15-20 different locations with one-to-three-year timeframes, greatly aids us in managing these multi-city projects.
Regarding land acquisition and resource availability, we’ve been fortunate. We have access to RailTel’s available land parcels, and their association with the railways means there’s ample space in various cities. Our challenge is often selecting the most conducive land parcel, but once identified, we don’t face the issues other data centres encounter with permissions and land title clearances. Working with RailTel in class-two and class-three cities significantly enhances our speed of execution. For example, for Mumbai, Gurgaon, Indore, and Gandhinagar, it took us less than three to four months to acquire and identify land. Most of the time is now spent on project planning and researching the optimal project size based on demand. We haven’t faced problems with land acquisition or resource availability, and we’re now gearing up to simultaneously work on at least 10 projects at any given time for the next four to five years.
So, your goal is to have 250 MW of capacity, but what is your current operational capacity?
Our current operational capacity is in the range of about 36 MW from our Chennai facility.We’ve already started work on Noida (10 MW) and Kolkata (15 MW). Our edge data centres are typically 0.5 MW to 1 MW, and we have about 4 MW of capacity planned across four to five such locations. So, currently, we are sitting at an inventory of about 50 to 55 MW in various stages of deployment, with 36 MW completed and about 20 to 25 MW in phases of deployment. Overall, we have approximately 50 to 60 MW of capacity.
What timeline have you set for yourself to achieve this 250-MW goal?
We aim to achieve this by 2030, within the next five years. This 250-MW capacity specifically refers to our large format data centres in Chennai, Kolkata, and Noida, plus the roughly 100 edge data centres we plan to deploy. In addition, we’re also working on a unique concept of large data centre parks, ranging from 500 MW to 1 gigawatt of capacity. These parks would offer unmatched, worldwide lowest power tariffs. This can be achieved through our expertise at the transmission and grid levels, with our sister concern providing battery storage solutions and green power at economical rates, and by setting up small power plants. We’ve discussed these concepts with some key large customers.
So, if you consider our overall plan, it’s actually much more than 250 MW. Even if one of these data centre parks materialises, it would add almost 300 to 500 MW of capacity. But specifically for the edge and mid-size enterprise data centres in Chennai, Noida, and others, by 2030, we expect to have an inventory of about 250 MW of capacity.