In a significant boost to Maharashtra's rapidly expanding digital infrastructure ecosystem, the Maharashtra Electricity Regulatory Commission (MERC) has approved the development of a dedicated 400/220 kV GIS substation at Ambernath to support a large-scale green data centre park being developed by Lodha Developers. The decision is expected to accelerate power connectivity for nearly 3 GW of projected data centre demand in the Mumbai Metropolitan Region (MMR).
The approval comes at a time when demand for data centre capacity continues to surge across India, driven by cloud adoption, artificial intelligence workloads, digital services, and increasing data localization requirements.
Dedicated Infrastructure Model Receives Regulatory Approval
Under the approved framework, the project will be executed through a Dedicated Distribution Facility (DDF) mechanism by the Maharashtra State Transmission Utility (STU) and Maharashtra State Electricity Transmission Company Limited (MSETCL).
A key aspect of the arrangement is that the entire capital investment for the transmission infrastructure will be funded by Lodha Developers. In addition, the developer will reimburse the operation and maintenance expenses associated with the facility throughout its lifecycle.
According to MERC, this structure ensures that the costs related to the project are borne entirely by the beneficiary and are not passed on to other transmission consumers through electricity tariffs.
Powering the Next Wave of Data Centre Growth
The Ambernath project is expected to become a critical component of Maharashtra's data centre infrastructure strategy. Industry estimates indicate that the region could witness nearly 3 GW of data centre load over the coming years, making reliable and scalable power infrastructure essential for future growth.
The Mumbai Metropolitan Region has emerged as India's leading data centre market, attracting significant investments from domestic and global operators due to its connectivity, business ecosystem, and strategic location.
The new substation will provide the transmission backbone required to support large-scale digital infrastructure developments and ensure power availability as new facilities become operational.
Urgent Need Following Bidding Setback
The project gained urgency after a tariff-based competitive bidding (TBCB) process was cancelled in April 2026. Regulatory filings indicated that the discovered tariff under the bidding process was considered commercially unviable, prompting authorities to discontinue the process.
Following the cancellation, STU highlighted the need for an alternative implementation model to avoid delays that could impact upcoming investments in the data centre sector.
The regulator agreed that timely execution of the transmission infrastructure was necessary to support projects expected to begin operations by 2028.
Nearly 3 GW of Demand in the Pipeline
The scale of anticipated demand underscores the strategic importance of the Ambernath project. STU has already approved grid connectivity for approximately 1,450 MW of data centre load in the region.
An additional 1,500 MW of demand is currently under evaluation, taking the total projected requirement to nearly 2,950 MW by 2028.
With hyperscale operators, cloud providers, and enterprise customers continuing to expand digital infrastructure investments, the availability of dedicated transmission assets is expected to play a crucial role in supporting future growth.
Strengthening Maharashtra’s Digital Infrastructure Ecosystem
The approval reinforces Maharashtra's position as one of India's most important data centre destinations. By enabling dedicated power infrastructure for large-scale digital developments, the state is creating an environment that supports investment while protecting existing transmission consumers from additional tariff burdens.
As demand for AI computing, cloud services, and digital platforms continues to grow, projects such as the Ambernath substation are expected to become increasingly important in supporting India's next phase of digital transformation.
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