A new class of batteries stores electricity through a controlled rusting process. When iron reacts with oxygen, it releases energy. Reverse the reaction, and the energy is stored again. The materials are simple. The ambition is not.

As India’s data centres expand to serve artificial intelligence (AI), this iron-air or “reversible rust” technology is being watched as a possible answer to a difficult question: how do you power infrastructure that never switches off with renewable energy sources that depend on intermittent sunlight and wind?

The answer lies in storage. Without it, solar and wind cannot provide a continuous supply. With it, intermittent generation can be converted into round-the-clock power.

But storage is only part of the equation. The deeper challenge is whether India’s renewable expansion can deliver reliable electricity at the scale AI infrastructure demands.

The government is confident the transition can be managed.

India will become number one in renewable energy. I have full confidence, given the way we are progressing

— Shripad Naik, Minister of State for New and Renewable Energy

The Minister was responding to a question from The Secretariat on whether renewable energy could power India’s expanding data centre footprint.

Naik's confidence rests on the scale of capacity already built. Total non-fossil installed capacity now stands at roughly 260 gigawatts, more than half of overall installed power capacity. The target is 500 GW by 2030.

Yet the pressure point lies not in installed capacity alone, but in how electricity is generated, stored, and delivered.

AI’s Appetite For Power

A conventional data centre consumes between 10 and 25 megawatts (MW). Hyperscale facilities built to train and run artificial intelligence models can exceed 100 MW, comparable to heavy industries like aluminium smelters. But unlike factories, servers operate continuously.

Even a brief disruption in voltage or frequency can interrupt operations, which is why data centres require continuous, stable power for all 8,760 hours of the year.

India’s operational data centre capacity is estimated at just over 1 GW today, concentrated in states such as Maharashtra, Tamil Nadu, and Karnataka. Industry projections suggest capacity could rise several-fold by the end of the decade as AI workloads expand and data localisation requirements deepen domestic storage.

Nationally, data centres account for roughly 0.5% of electricity consumption. In aggregate, that remains manageable. At the state level, however, adding 2 to 3 GW of 24/7 demand can strain transmission networks and urban distribution systems.

The nature of renewable generation complicates matters. Installed capacity reflects the theoretical maximum output. Actual generation depends on utilisation. Solar and wind plants operate at lower capacity factors because they depend on weather conditions. While renewables account for more than half of installed power capacity, they contribute only about 22 to 25% of actual electricity generation in the country. 

For data centre operators, intermittency is not a marginal issue. Facilities maintain redundant grid connections, battery systems, and diesel generators to guarantee uptime. Without firm and clean power, fossil fuels will continue to underpin grid stability.

From Lithium-ion To Iron-air

Lithium-ion batteries are already widely deployed to smooth hourly fluctuations. They can bridge short gaps, particularly after sunset when solar generation drops. But they are not designed to sustain the uninterrupted power that data centres require through days of weak wind or cloud cover.

This is where iron-air batteries can enter the conversation.

Just last week, Google announced plans to develop what it described as the world’s largest iron-air battery system alongside a US data centre in Minnesota. The system is designed to deliver up to 100 hours of storage, pairing wind and solar generation with multi-day backup.

India has also started building capacity in this space. Chennai-based MEINE Electric recently raised ₹6.7 crore in pre-seed funding to advance its iron-air long-duration energy storage systems from laboratory prototypes to pilot-ready units. Its technology is designed to provide around 16 to 24 hours of storage using abundant materials such as iron, air, and water.

"Long-duration storage is increasingly seen as critical in renewable-heavy grids. If iron-air systems prove commercially viable at scale, they could allow data centres to procure round-the-clock renewable electricity rather than rely on diesel back-up," an energy-transition advisor told The Secretariat.

Beyond Batteries

Storage is only part of the equation. Hybrid renewable projects combining wind and solar can smooth daily generation profiles. Corporate renewable procurement has expanded under Green Energy Open Access rules, enabling commercial consumers to source clean power directly.

Nuclear power offers another option. Unlike wind and solar, nuclear plants provide steady baseload electricity without operational carbon emissions. India’s planned nuclear expansion could complement renewables in supporting large, stable loads such as data centres.

Transmission capacity must expand alongside generation. Renewable-rich states require reliable links to metropolitan load centres. Financially stressed distribution companies must be able to support long-term contracts for firm clean power.

Energy Conservation Act

Data centres are not currently classified as ‘Designated Consumers’ under India’s Energy Conservation Act. The category includes energy-intensive industries such as steel, cement, and aluminium. Designated Consumers are required to conduct regular energy audits, appoint certified energy managers, and meet efficiency targets under the Perform, Achieve and Trade scheme.

Data centres are not yet subject to these obligations. As their electricity demand rises, that regulatory gap is likely to draw greater scrutiny.

India’s digital economy is expanding rapidly. Renewable capacity has grown in parallel. The next phase depends on aligning generation, storage, and grid reform with the pace of AI-driven infrastructure.

Iron rust may seem an unlikely protagonist in that story. Yet in an electricity system shaped increasingly by artificial intelligence, long-duration storage could determine whether India’s data centres run on coal or clean power.