India's Adani Looks To Nuclear For 'aggressive' AI Data Center Push

India's Adani Group will be "aggressive" in building out artificial intelligence data centers as well as the energy infrastructure that will run them, potentially setting up nuclear power plants, the youngest son of Asia's second-richest man said.

"Data centers is very, very big. What we had assumed we would do in 2030, we have already crossed, and the amount of demand that's coming in keeps rising," Jeet Adani told Nikkei Asia, adding that a mix of low costs and shifts in energy regulations gave India a "natural advantage" when it comes to building out AI data centers.

The group, which is building such infrastructure in India for tech giants such as Google, sees itself as "one of the biggest investors" in the Indian nuclear energy space, said Adani, who oversees the digital and airports divisions. A law opening up the closely controlled sector to private companies was passed by the country's parliament last week.

Adani is among the four family members -- brother Karan and cousins Pranav and Sagar -- who are expected to take over the sprawling media-to-ports conglomerate when his 63-year-old father Gautam retires.

Adani was speaking ahead of the start of operations at Mumbai's newly constructed airport. He said the group is looking to invest about 1 trillion rupees ($11 billion) over the next five years into the unit to support a series of new airports and upgrades to existing facilities.

The group's wider infrastructure gambit includes an investment of up to $5 billion into building out Google's AI data center projects in India. In October, Google said it was going to invest $15 billion to build such facilities in India over the next five years.

The Adani Group is looking to eventually build AI data centers larger than 1 gigawatt in capacity across the country, including in cities like Vizag, Navi Mumbai, Noida and Hyderabad, Adani said.

The company will only focus on providing the infrastructure and other facilities for the data centers.

"We're not in the neo-cloud business," Adani said. "Let's say Google is getting in their TPUs (tensor processing units) in Vizag. We won't invest in the said TPUs."

On the energy side, Adani said the group is ready to use its vast renewables capacity to support the power-hungry data centers. Subsidiary Adani Green Energy is already the country's largest renewable energy company, with expansive solar and wind power generation capabilities.

"We have the ability to give as much renewable electricity as any of the hyperscalers would want," Adani said. "We have the ability to develop [infrastructure] fast, and develop [them] modularly."

However, Adani said a foray into nuclear energy would be closely tied to the demand for power from the data centers.

"Nuclear [energy] is something that we have been very, very actively looking at," Adani said. "I think it was tabooed for too long."

The company will look to build and own the power plants, but would outsource the reactors, he added.

India's parliament passed the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) bill on Friday, which will replace current laws on atomic power and increase privatization of the sector by allowing Indian companies to build, own or operate nuclear plants and reactors, among other things.

The new law is aimed at helping expand India's nuclear power generation from the current 8 GW to 100 GW by 2047. Currently, only 3% of India's electricity comes from nuclear power.

The Adani Group's data center moves parallel investments by India's biggest conglomerates including Reliance Industries and the Tata Group, which are also set to build out AI data centers in collaboration with the likes of Canada's Brookfield and U.S.-based TPG.

India has 1.4 GW of data center capacity under construction and another 5 GW in the planning stage, with current operational capacity at 1.4 GW, according to a report from Macquarie Research.

"If India plays its cards right, it can easily convince the hyperscalers to build 10 GW of data center capacity in the next five years," Adani said. "I see [demand for] 50 GW of renewable electricity coming just from the data centers."

Source: Asia_Nikkei