Nomura, a prominent global investment bank, has projected a significant boom in India’s electricity demand, a compound annual growth rate (CAGR) of over 7% from FY24 to FY27. 

It is associated with India’s increasing economic activities, improving electrification, and rising demand across key sectors, including data centers, electric vehicle (EV) charging, and green hydrogen production.

Changing weather patterns are causing supply shortages, and are expected to upgrade power demand in the future. By 2025, electricity use is expected to increase by 7.2% from last year, higher than last year’s growth rate of 7.1%.

Renewable energy will play a crucial role in meeting this growing demand. India’s target is to supply 35% of the nation’s electricity in FY25, higher than 33.5% in FY24, with solar and wind expected to meet approximately 75% of this increase. 

Solar power alone is expected to grow by 23% annually, aligning with India’s goal of achieving 500 GW of renewable capacity by 2030 and supporting a net-zero emissions target by 2070.

Three primary sectors—data centers, EVs, and Green hydrogen—are expected to structure power demand. Data center capacity in India is expected to grow gradually with digital platforms like OTT and e-commerce, from 960 MW to 7.5 GW and 9GW by FY30.

Additionally, green hydrogen production is projected to add between 150 and 300 TWh to India’s power needs as it scales up industrial decarbonization efforts.

To support this demand, India’s National Electricity Plan (2023–32) includes solid investment in transmission infrastructure, with an estimated $110 billion allocated from FY22 to FY32.

The plan also targets to promote inter-regional capacity and develop high-voltage direct current (HVDC) lines, strengthening efficient power transfer across the country. 

Nomura estimates renewables could take place for 49% of India’s electricity by 2040,  positioning the nation as a leader in global renewable energy adoption.

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