If New York can halt it, why not Vizag?
- Jun 21
- 6 min read
The citizens of Visakhapatnam deserve to be in the driver’s seat. Right now, they are groping in the dark as the state machinery deliberately keeps them ill-informed about the mega data centres that will reshape their landscape and drastically disrupt their lives.
By Ajith Pillai in Chennai
What insights about hyperscale data centres do a few wise men in the Union and Andhra Pradesh governments have that legislators in New York state have no access to?
On June 4, the New York state legislature passed the Responsible Data Centre Development Act. The law, if cleared by the governor, will place a one-year moratorium on permits for “large data centres,” with peak demand of 20 megawatts (MW) or more. Also, all data centre projects would require a detailed environmental impact report, as well as new labour, energy-efficiency, and transparency standards, and measures to protect the electricity tariffs of regular consumers.
The law cleared the Senate by a vote of 44-16 and the Assembly by 102-39. Clearly, the majority did not approve of the mushrooming of data centres in their state.
Cut to Visakhapatnam, or Vizag, projected as India's new data centre capital. The Google-Adani consortium has received clearance to set up two giant 1-GW (gigawatt) plants. It was initially presented as a single 1- GW project, but the environmental clearance granted revealed that not one but two data centres, each with 1 GW of capacity, had been sanctioned. Add to that the proposed Reliance hyperscale data centre at Bhogapuram, and the Vizag region will end up having a data centre power demand of about 4 GW.
To grasp the scale of these projects, consider the moratorium proposed in the new law passed by lawmakers in New York. This legislation intends to halt all projects with a capacity of 20 MW (megawatts) or more.
Since 1 gigawatt (GW) equals 1,000 megawatts (MW), the 4 GW approved in Vizag translates to a total of 4,000 MW capacity. In simpler terms, this is equivalent to 200 data centres, each with a capacity of 20 MW, on which legislators in New York have voted to impose a moratorium.
And if the Andhra Pradesh government decides to increase the data centre capacity in Vizag to 6 GW, as reported in the media, it will be akin to 300 data centres, each with a capacity of 20 MW, all consolidated into about six mega hyperscale data centres in the Visakhapatnam area.
The water, power and land required to run such a huge concentration
of data centres is humungous. According to techtrends.com, a 1-GW data centre is a facility capable of drawing 1000 MW of power continuously to support AI workloads on a scale. That is the electricity required to power 700,000 to 800,000 US homes.
A 1-GW unit also requires between 500 million and 1 billion gallons of water per year. Add to that between 500 and 800 acres of land.
Given its commitment to the Silicon Valley tech billionaires and their local partners, the Andhra Pradesh government does not brook any criticism of its dream data centre hub project. This commitment is evident in the state authorities' suppression of criticism, such as blocking videos on social media critical of the data centre explosion.
Nara Lokesh, the enthusiastic Andhra Pradesh IT Minister and son of Chief Minister Chandrababu Naidu, does not view water consumption of data centres as an area of concern. In a recent public interaction, the IT Minister threw up this factoid to “educate” his audience: he noted that the Godavari River discharges 3,000 TMC (Thousand Million Cubic Feet) of water into the Bay of Bengal every year. This volume of water, he said, was the water consumed by Vietnam and Brazil. In comparison, data centres with a capacity of 6.5 GW consume only 1 TMC of water. His burden: the water consumed by the proposed units in Vizag was minuscule compared to the water that drains into the sea.
Surely, the Hudson River and several other water bodies in New York state discharge thousands of TMC of water into the Atlantic Ocean each year. However, it’s surprising that no lawmakers in New York have mentioned this fact to support the case for hyperscale data centres!
What Nara Lokesh conveniently forgot was that the Godavari traverses some 1,465 kms from the Western Ghats of Maharashtra, across the Deccan Plateau, before meeting the sea on the east coast. The water discharged is the total of the vast ecosystem that it sustains along its course.
To drive home his point about water usage, the Minister cited another example: a 1-GW thermal power plant consumes seven times as much water as a 1-GW data centre, he said. Why, then, were people focusing on data centres rather than power plants? This is a curious comparison. As Sohan Hatangadi from the Greater Visakhapatnam People’s Forum points out: “A thermal power plant generates electricity for millions of homes and industries, whereas a data centre consumes that electricity and additionally requires water to cool its systems. Saying that a data centre uses less water than a thermal power plant is like saying a car uses less fuel than the refinery that produces that fuel. The Minister is comparing production with consumption."
The IT Minister also publicly advocates discussions with local citizens and communities. But the truth is that the data centre drive in Visakhapatnam has been clouded in utmost secrecy, frustrating many citizens seeking basic information. As Hatangadi puts it: “Agreements with data centre companies have been signed under a non-disclosure agreement, and environment clearance processes have not been publicly shared. Citizens and civil society organisations have written to the government and received no response. If the government truly believes in an open conversation, it must begin by making all project documents public.”
Meanwhile, there is a question mark on the financial profitability of data centres. It largely depends on the increasing demand for data storage from AI companies. However, the leaders in this sector, Anthropic and OpenAI, are both reporting significant losses. In fact, OpenAI reportedly lost $38.5 billion last year, nearly eight times as much as it lost in 2024. Almost all AI startups are also experiencing losses. So where does that leave data centres?
According to tech commentators and analysts like Ed Zitron, the massive buildout of AI data centres is a potential financial crisis in the making. He thinks these facilities are being constructed in anticipation of demand that does not exist and will likely end up as loss-making infrastructure. He fears they could end up as White Elephants with no alternative use.
The data centre drive in Vizag also comes at a time when data centres face stiff opposition from local governments and communities worldwide. Said Senator Kristen Gonzalez, of the New York State legislature, after the passage of the bill imposing a one-year moratorium on data centres:
"This is a historic moment for New York. For too long, Big Tech has benefited from under-regulation, writing their own rules on large-scale data centre development with little accountability or transparency on local impacts. Technology should improve people’s lives, not drive up our energy bills, exhaust our natural resources, or increase pollution. That’s why this bill takes a responsible approach to hyperscale data centre development, putting New Yorkers in the driver’s seat and studying the environmental and economic impacts of data centres.”
The citizens of Visakhapatnam also deserve to be in the driver’s seat. Right now, they are groping in the dark as the state machinery deliberately keeps them ill-informed about the mega data centres that will reshape their landscape and disrupt their lives.
Posters courtesy Human Rights Forum
Editor’s Note: This is the third part of a story on Vishakhapatnam’s hyperscale data centres.
Ajith Pillai is member, Editorial College, senior editor and writer, independentink.in. A seasoned journalist working in the profession for 40 years, he has reported out of Delhi, Mumbai, Chennai, Andhra Pradesh and Kashmir on a broad spectrum of events related to politics, crime, conflict and social change. He has worked with leading publications, including The Sunday Observer, Indian Post, Pioneer, The Week and India Today, where he headed the Chennai bureau. He was part of the team led by Editor Vinod Mehta that launched Outlook magazine and headed its current affairs section till 2012. Under his watch, Outlook broke several stories that attracted national attention and questioned the government of the day. He has written two books—'Off the Record: Untold Stories from a Reporter’s Diary,’ and a novel, ‘Junkland Journeys’.
Also see by Ajith Pillai:
A $15 billion data cenre in Vizag: So why this secrecy?
A Disaster in the Making: Red Carpet for Hyper-scale Data centres
When Tech Billionaires Come Marching In
https://www.independentink.in/post/when-tech-billionaires-come-marching-in
AI to the left of them, AI to the right
https://www.independentink.in/post/ai-to-the-left-of-them-ai-to-the-right
AI is not reliable. Especially in a conflict zone. QED. Hence proved.
https://www.independentink.in/post/was-ai-used-to-murder-school-children-in-iran
To err is AI: Bubble burst?
https://www.independentink.in/post/to-err-is-ai-bubble-burst