Maharashtra Expands Green Data Centre Policy to Boost Digital Infrastructure

Maharashtra has significantly expanded its policy for Integrated Green Data Centre Parks, increasing the number of eligible projects from three to 20 and extending the policy beyond the Mumbai metropolitan region to the entire state as it looks to accelerate investments in digital infrastructure and achieve its long-term capacity targets.

The state government, through a recent resolution, amended its October 2024 policy that had restricted the development of integrated green data centre parks to Mumbai, Navi Mumbai and the Mumbai Metropolitan Region (MMR). The revised policy will now allow such parks to be set up across Maharashtra.

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The changes are part of the state's broader programme under which it aims to develop 30-40 gigawatts (GW) of green energy-powered data centre capacity by 2047.

According to the government resolution, limiting the policy to three projects in the Mumbai region would not have been sufficient to achieve this objective, necessitating an expansion in both the number of projects and the geographic coverage of the policy.

The government has also eased some of the operating conditions for developers. The mandatory use of green energy for core data centre activities has been reduced to 51% from the earlier requirement of 100%, a move expected to improve project viability and ease implementation challenges.

“This policy will create a clear ripple effect for real estate and infrastructure by unlocking large land parcels, accelerating demand for industrial-grade built-to-suit campuses, and enabling a ‘plug-and-play’ ecosystem in which power, fibre connectivity, and logistics are planned at the park level. As connectivity and infrastructure deepen, we will see more geographically diversified investments across the other emerging nodes in Maharashtra,” said Niranjan Hiranandani, Chairman, NAREDCO.

Under the revised framework, integrated green data centre parks with investments of Rs 30,000 crore will be eligible for a power tariff concession of Rs 1 per unit for 10 years. Projects involving investments of Rs 60,000 crore or more will qualify for a Rs 1 per unit electricity subsidy for 20 years.

The government has also approved an industrial incentive subsidy equivalent to 75% of eligible fixed capital investment for integrated green data centre parks attracting investments of Rs 60,000 crore or above.

In another key change, developers of such parks will be eligible for an interest subsidy of 4% on term loans for a period of 10 years, subject to an annual cap of Rs 25 crore.

The policy has also done away with the earlier requirement of reserving 2% of the land area within the park for incubation centres.

Further, investment eligibility criteria have been broadened. Instead of considering only the developer's investment, the government will now account for the combined investment made by the landowner, developer and units operating within the park.

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The original policy, announced in October 2024, envisaged the establishment of three integrated green data centre parks in the Mumbai region, each with a minimum capacity of 500 MW and minimum investment of Rs 30,000 crore.

The latest relaxations and incentives will apply not only to future projects but also to eligible integrated green data centre parks that have already received approval from the state government under the earlier policy.