The Chief Minister's Office of Himachal Pradesh, citing remarks by Chief Minister Thakur Sukhvinder Singh Sukhu, on Sunday, 19 July 2026, made a pointed case for siting data centres in cooler hill states rather than hot-climate regions, arguing that extreme ambient temperatures drive up electricity consumption substantially.

Context

In the post, CM Sukhu stated: 'यदि आंध्र प्रदेश और अन्य गर्म जलवायु वाले राज्यों में डेटा सेंटर स्थापित किए जाते हैं, तो वहाँ का तापमान पहले से ही 48°C तक रहता है।' ('If data centres are established in Andhra Pradesh and other hot-climate states, temperatures there already reach up to 48°C.'). He added that in such conditions, electricity consumption to maintain lower operating temperatures increases even further. The statement was framed as a reply to the CMO's own handle, suggesting it forms part of a broader public argument being advanced by the Himachal government.

Himachal Pradesh, situated in the western Himalayas, enjoys ambient temperatures that are significantly lower than those of peninsular and coastal Indian states for most of the year. This natural cooling advantage directly reduces the mechanical cooling load that data centres must run continuously to protect servers and storage hardware.

Policy Backdrop

India's data centre sector has expanded rapidly on the back of rising cloud adoption, AI workloads, and growing demand for digital services. States across the country have competed to attract these capital-intensive investments, which promise jobs, tax revenue, and anchor tenants for broader IT ecosystems. The Government of India released a draft Data Centre Policy in 2020 to provide a national framework for such investments, though detailed energy-efficiency norms for siting decisions have remained a subject of ongoing debate.

Andhra Pradesh, with its aggressive industrial outreach and large land parcels, has positioned itself as a destination for technology and data infrastructure. However, its tropical coastal climate means that cooling infrastructure — typically the single largest operational cost for a data centre — must work considerably harder than in temperate or sub-alpine locations. Industry benchmarks indicate that cooling can account for 30 to 40 per cent of total data centre energy use, a figure that rises sharply when outside air temperatures are high.

Stakeholders and Impact

For technology companies and hyperscale cloud operators evaluating Indian locations, energy cost and availability are decisive factors. A site where ambient cooling reduces the need for mechanical chillers translates directly into lower power usage effectiveness (PUE) ratios and, therefore, lower operating expenditure. State power utilities in hot regions also face the compounded burden of serving data centres whose demand spikes during summer months when grid stress is already high.

For Himachal Pradesh, attracting even a handful of mid-to-large data centres would represent a significant revenue and employment opportunity for a state whose economy has traditionally relied on horticulture, hydropower, and tourism. CM Sukhu's government has signalled that IT-sector growth is a priority, and the cooling-cost argument gives the state a concrete, quantifiable edge in investor conversations.

What's Next

The Himachal Pradesh government is expected to sharpen its data centre pitch through dedicated IT investment policies and possible incentive structures in coming budget cycles. Observers will watch whether the state formalises energy-efficiency metrics — such as PUE targets or green data centre certifications — as part of its investment framework. At the national level, any central guidelines on climate-appropriate or green data centre siting could either reinforce or complicate the hill-state advantage that CM Sukhu is now publicly articulating. The debate also adds a new dimension to India's broader push for sustainable digital infrastructure as AI-driven compute demand accelerates energy consumption across the sector.