The rapid expansion of data centers in Visakhapatnam (Vizag) could reshape the renewable energy market by creating large, round-the-clock power loads and accelerating demand for hybrid renewable energy, energy storage, and supporting transmission infrastructure.

Unlike conventional commercial loads, data centers require continuous and highly reliable electricity. Meeting this demand with clean energy would require a combination of solar, wind, storage, and grid supply rather than standalone solar projects.

Andhra Pradesh plans to allow data centers with a connected load of at least 300 MW to operate internal distribution systems and procure electricity directly from renewable energy generators, captive projects, and power exchanges. At least 51% of their electricity consumption must come from renewable sources.

Under the Andhra Pradesh Data Center Policy (4.0) effective until 2029, the state has set a target of adding up to 1 GW of data centers. The Ministry of New and Renewable Energy has also identified 5 GW of demand from proposed green hydrogen and green ammonia projects in the Visakhapatnam area. Visakhapatnam is being promoted as a data center hub.

According to the state’s Information Technology, Electronics and Communications Department, Google, in partnership with AdaniConneX and Nxtra by Airtel, broke ground on an AI hub in Visakhapatnam in April 2026. Google has committed approximately $15 billion between 2026 and 2030 toward the broader development, including gigawatt-scale data center infrastructure.

Apart from this data center in Vizag, the state has also approved a 1,000 MW facility by Renew AP Green Data Center, a 436 MW project by Data Center Holdings India, a 512 MW project by AM AI Factory, and a gigawatt-scale AI data center by Reliance Industries.

The state has also approved 500 MW data centers by Sify Infinit Spaces and a 100 MW data center by CtrlS Datacenters. Another 486 MW data center by Data Center Holdings India has also been approved.

The emergence of data centers comes as Andhra Pradesh strengthens its transmission infrastructure to accommodate large new electricity loads.

In July 2026, REC Power Development and Consultancy auctioned an interstate transmission system project primarily designed to meet the power requirements of 4.5 GW of green hydrogen and green ammonia projects in the Visakhapatnam area. The transmission project was also envisaged to serve data center loads around Pendurthi and Visakhapatnam.

The convergence of green hydrogen, data centers, and other industrial loads could accelerate the need for transmission expansion alongside renewable generation and storage.

Storage Demand Could Rise

Adding large, round-the-clock data center loads to the grid could strengthen the commercial case for solar-wind hybrid projects paired with battery and pumped storage.

Andhra Pradesh already has a pipeline of 3 GW of solar-wind projects integrated with pumped storage and 2.01 GW of solar-wind hybrid projects. The state has also targeted 25 GWh of battery energy storage and 22 GW of pumped storage capacity.

In 2025, Andhra Pradesh Transmission Corporation auctioned a 1,000 MW/2,000 MWh standalone battery energy storage system project, while several other battery and pumped storage projects are under development.

The expansion of renewable energy and storage could, in turn, support the state’s broader clean energy manufacturing ambitions.

Under the Integrated Clean Energy Policy, Andhra Pradesh has targeted 20 GW of solar manufacturing capacity, 5,000 MWh of battery manufacturing capacity, and 3,000 MW of electrolyzer manufacturing capacity.

The growing power demand from data centers and the evolving renewable energy procurement strategies of commercial and industrial (C&I) consumers will be among the key themes discussed at the C&I Clean Energy Event in Visakhapatnam on September 24.