Integrated Planning Crucial for India's Power Sector Transition

Harsh Shah, Managing Director of IndiGrid Infrastructure, stated at the ET Energy Leadership Summit 2026 that the focus for India's power sector should shift from installed megawatts to the collective ability of generation, storage, transmission, and distribution to deliver electricity effectively. He highlighted that the primary challenge for India is not merely adding generation capacity but ensuring reliable transmission and supply to consumers.

Shah noted that generation, storage, and transmission projects are currently developed on disparate timelines, despite their eventual operation on the same grid. He advocated for execution-level planning that synchronizes project pipelines, bidding schedules, and infrastructure timelines. Shah also suggested that utility-scale batteries should be considered grid infrastructure due to their capacity to absorb surplus renewable electricity and release it as needed. IndiGrid is developing approximately 2 GW of battery-storage projects, with nearly 1 GW already completed. He called for further experimentation with alternative battery technologies, such as sodium-based systems, to mitigate future technology and commodity risks.

India Focuses on Supply Chain Resilience for Grid 2035

The future of India's power system, dubbed Grid 2035, will prioritize anticipatory transmission, commercially viable storage, and strong project execution. Industry leaders highlight the importance of supply chain resilience to ensure that renewable capacity translates into reliable, round-the-clock electricity. A central challenge involves the disparity between the time needed to build renewable generation and the longer development period for transmission infrastructure.

To address these issues, Siemens Energy India is increasing localization, automation, and supplier visibility. These measures aim to reduce dependence on imported components and effectively manage long-term demand. Tender structures are also being re-evaluated to better account for commodity-price fluctuations and to support longer-duration storage solutions, moving beyond short-term systems. Financing for these projects is contingent on factors such as supplier quality, payment security, and land availability, with banks scrutinizing these aspects closely.

AI and Data Center Expansion Drive New Electricity Demand in India

The accelerating growth of AI and data centers in India is generating a new wave of concentrated electricity demand. This trend requires coordinated planning across power, transmission, water, and cooling infrastructure, according to industry and policy experts at the ET Energy Leadership Summit 2026. Existing regulatory frameworks are adapting to accommodate these large, energy-intensive consumers.

Data centers could be developed in approximately two years, while associated transmission infrastructure may take longer. This timing disparity highlights the importance of advance connectivity planning. Large data center hubs might operate under structures similar to special economic zones, with other facilities procuring electricity through open access or as bulk consumers directly from utilities.

Cooling systems are a major factor, potentially accounting for 30-40% of a data center's energy consumption. Efficiency improvements, such as transitioning from air cooling to liquid cooling, optimizing chilled-water systems, and using AI-based controls, are crucial. Integrated infrastructure planning and energy efficiency are critical for sustaining growth in this sector.