Andhra Pradesh has approved a power distribution licence framework for Google’s upcoming data centre project in Visakhapatnam, introducing a policy model that could significantly change how large-scale digital infrastructure projects source and distribute electricity in India, as per a Hindu BusinessLine report.
According to the report, approval has already been granted under Andhra Pradesh’s new framework for strategic data centre projects, though a formal announcement from the state government or Google is still awaited.
Under a recent Energy Department order, Andhra Pradesh introduced a mechanism allowing strategic data centre operators to obtain Deemed Distribution Licences (DDL), recognising that modern data centres require specialised systems for electricity procurement, distribution and infrastructure management.
The order stated that enabling qualified data centres to secure distribution licences for projects under development or proposed in the state had become necessary.
With this move, Andhra Pradesh became the 1st Indian state to allow private companies outside the conventional power sector to receive dedicated electricity distribution licences for infrastructure operations.
The framework applies to projects developed by a single investor with a minimum connected load of 300 MW in Andhra Pradesh, while also allowing developers to combine loads from multiple data centre facilities across the state to meet the threshold.
Electricity supplied under the licence can only be used for approved data centre operations within the licensed area, and operators cannot supply power to 3rd-party consumers outside the zone without approval from the Andhra Pradesh Electricity Regulatory Commission.
The policy also gives operators flexibility to source electricity through renewable energy producers, bilateral power purchase agreements, open access mechanisms, captive generation plants, and power exchanges.
The policy announcement comes as Andhra Pradesh accelerates efforts to position itself as a major digital infrastructure destination.
Last month, the foundation stone was laid for Google Cloud’s India AI Hub in Anakapalli, involving an estimated investment of $15 billion.
Officials cited in reports stated that data centres are increasingly becoming power-intensive and mission-critical infrastructure assets requiring uninterrupted and scalable electricity supply, often running into several hundred megawatts.
Visakhapatnam is also witnessing growing interest from other large technology and infrastructure investors.
Earlier reports indicated that Reliance Industries Limited is planning a ₹1.6 lakh crore investment in Vizag involving a 1.5-gigawatt data centre cluster supported by captive solar power generation and battery storage systems.
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The new Andhra Pradesh policy marks a major shift in India’s digital infrastructure framework, creating a dedicated power distribution model for strategic data centres while strengthening Visakhapatnam’s position as an emerging technology and AI infrastructure hub.
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Published on: May 7, 2026, 10:49 AM IST
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