Siemens is well placed to support with technology solutions that cover the lifecycle of data centers.

Robert HK Demann, Executive Vice President and Head of Smart Infrastructure, Siemens India

What is the latest trend of data center market in India?

The data center sector is witnessing high growth over the past few years - this trend is expected to continue in the coming years.

Some of the trends witnessed in the data center space include the increasing number of players (international and domestic) interested in investing in this sector. The growth of this sector has led to the government according infrastructure status to data centers >5 MW capacity of IT load to increase access to cheaper credit and attract more foreign investors.

The trend of Hyperscalers and Colocation data centers will continue but will be complemented by growth of smaller scale edge data centers. Major cities with access to reliable power and connectivity will continue to attract the largest share of investment for new data centers, although some Tier-2 cities are expected to also account for new builds.

For the data center operators, the focus on improving operational efficiency and achieving cost optimization continues to be a primary concern. There is also a growing focus on sustainable operations and hence, some of  the larger data centers will look for cleaner sources of energy to power the data centers in coming years.

How is the demand picking up? Which are the key demand drivers?

India's data center infrastructure demand is projected to remain strong in the coming years, as the current capacity is expected to double in next few years.

One of the major factors powering this growth is the rise of India as the fastest growing 'digital nation.' The rapid growth of telecommunication and digital services in India (2nd largest internet user base, 60x growth in data usage in FY21 over FY15), coupled with growth of IT/ITeS sectors and government regulations on data localization has led to a tremendous growth in data center infrastructure capacity in India.

The growth in some of the world's largest public platforms (e.g., Aadhar, BHIM, COWIN) also helped spur the growth of this sector, which is expected to get an additional boost by the launch of 5G services and related growth of the Internet of Things (IoT). The demand base is also increasing with sectors such as IT and BFSI leading the way in usage of data centers for their operations. India also enjoys a competitive advantage over major APAC countries in context of rental costs, capex requirement etc.

What are the key challenges faced in setting up new data centers?

Data centers are 'critical infrastructure' and require guarantees of 100% uptime. One of the main challenges of the sector is the need for 'reliable and resilient operations' that is critical for decision of setting up new data centers. The dependence on grid power for operations thus leads to the challenge of dealing with power outages, particularly in non-metro cities and preference for an independent feeder/substation. Of equal importance is the security of data centers, in light of the growing threat of cyber-attacks on the installations.

Data centers also grapple with the challenge of 'sustainability'. Data centers have high energy consumption requirements (power required for one data center of say 20 MW can power nearly 20,000 homes). Globally data centers account for nearly 2-3% of total energy consumption and this number is projected to rise further. The need to maintain 100% uptime has also led to the reliance on diesel powered gensets as source of backup power (average cost per minute of data center downtime is Rs 750,000).

Data center infrastructure players are also looking at 'flexibility and speed' to enable shorter time of installations and are hence looking for digital twins and modular designs to help reduce time and increase flexibility of construction/installation and operations.

How does technology play a key role in data centers? How are energy efficient technologies gaining traction in data center facilities? What are the solutions offered?

As climate change awareness is growing, attitudes towards reliable and sustainable operations are hardening. In context of energy efficiency, offerings such as White Space Cooling Optimization allows addressing multiple core KPIs of data center operators - it improves data center resilience against overheating of server racks and adjusts cooling efforts dynamically to demand to reduce OPEX significantly.

Similarly, solutions such as power quality monitoring help improve data center performance, while other solutions to monitor individual feeders and identify power peaks support energy efficiency efforts and improve system resilience.

To support decarbonization, data center players can rely on integrated energy systems like Micro Grid solutions that utilize quality and cost-effective power from a pool of energy resources like grid and renewable power sources (solar etc). These solutions, coupled with battery storage solutions also act as replacement for diesel gensets for backup power.

To support data centers, players in optimizing the time for construction and commission, improving flexibility and reduce lifecycle costs, digital twins that can help design-build-operate are gaining traction. Also, cyber security offerings can minimize the risk of potential digital intrusions in data center operations, improving resilience of data centers.

What opportunities do you look forward in data center market? What are your future plans? What is your outlook on the market?

Growth in Hyperscalers & Colocation Data Centers: Growth is mainly expected in technology hubs with strong connectivity and reliable power supply. The planned investments by international and domestic players have created a strong pipeline of data center projects expected to materialize in the next few years.

Support customers with flexibility & speed: Customers are looking for rapid deployment. Our solutions such as prefabricated Power Skid and E-House help in reduced capital expenditure, speedy deployment, and less installation challenges at site.

Enable sustainable operations: Expectations of data center customers have also evolved from being pure infrastructure providers to plan for unplanned downtime and focus on sustainability of operations. Siemens with our end-to-end solutions can increase asset life-time due to load optimization and reduce energy cost by demand optimization. Our capabilities of maintenance predictions and providing transparency in operations can help avoid unexpected maintenance cost. Our energy optimization solutions, e.g., Whitespace cooling optimization and demand flow offering solutions, are suitable for better power usage effectiveness (PUE).

The industry is repositioning itself for the next wave of cloud adoption and Siemens is well placed to support with technology solutions that cover the lifecycle of data centers.

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