Archive · 22 Jul 2026
Andhra Pradesh's Google Data Center License Sparks Legal Debate
The Andhra Pradesh government has issued a notification to grant a deemed distribution license to Google's data center, which will be set up in Vishakhapatnam.
This move aims to provide cheaper power to the data center by avoiding open-access charges.
However, there are legal concerns as the Electricity Act, 2003, does not provide for deemed distribution licenses for private entities like Google.
The incumbent utility, Eastern Power Distribution Company of Andhra Pradesh Limited, will lose significant future revenue due to this move.
The government argues that the 2022 amendment allows them to determine the minimum area of supply for new distribution licensees.
However, legal experts point to the Supreme Court's ruling on railways, which suggests that such moves are legally untenable and could lead to litigation.
Andhra Pradesh government proposes granting deemed distribution license to Google's data center in Vishakhapatnam.
The data center will have a load of 1 gigawatt (Gw) and is a $15 billion investment by Google.
Legal concerns arise as the Electricity Act, 2003, does not provide for deemed distribution licenses for private entities.
Incumbent utility will lose future revenue as the data center will not pay open-access charges.
Government relies on 2022 amendment to determine the minimum area of supply for new distribution licensees.
- Who
- Andhra Pradesh government and Google
- What
- Granting deemed distribution license to Google's data center
- When
- Recent notification issued by Andhra Pradesh government
- Where
- Vishakhapatnam, Andhra Pradesh
- Why
- To facilitate Google's data center setup and provide cheaper power, avoiding open-access charges
Government's Perspective
Legal and Regulatory Concerns
Purpose of Deemed License
Government's Perspective
The government aims to facilitate Google's data center setup by granting a deemed distribution license to avoid open-access charges and provide cheaper power.
Legal and Regulatory Concerns
The deemed license status is legally questionable as it lacks provision in the Electricity Act, 2003, and could lead to regulatory and revenue issues.
Impact on Incumbent Utility
Government's Perspective
The government believes the move will not immediately impact the incumbent utility's revenue since the data center is not an existing consumer.
Legal and Regulatory Concerns
The incumbent utility will lose significant future revenue as the data center will not pay open-access charges, affecting its financial stability.
Legal Precedent
Government's Perspective
The government argues that the amendment in 2022 rules allows them to determine the minimum area of supply for new distribution licensees.
Legal and Regulatory Concerns
The legal precedent, such as the Supreme Court's ruling on railways, suggests that designating deemed distribution licensees to avoid cross-subsidy is legally untenable and could lead to litigation.
- Data Center Load
- 1 gigawatt (Gw)
- Investment by Google
- $15 billion
- Location
- Vishakhapatnam, Andhra Pradesh
- Incumbent Utility
- Eastern Power Distribution Company of Andhra Pradesh Limited
- Peak Load of Incumbent Utility
- 4 gigawatts (Gw)
- Minimum Load for Deemed License
- 300 megawatts (Mw)
- Regulatory Commission
- Andhra Pradesh Electricity Regulatory Commission
- Legal Precedent
- Supreme Court ruling on railways as deemed distribution licensee