Evaluation of Indian and Singapore data center power markets for GenCo s entry

Abstract

GenCo is a pioneering fuel cell based power generator producer based in the US. These power generators can run on wide variety of fuels including Natural gas, bio-gas and land-fill gas producing clean power onsite. By focusing on a distributed generation platform which delivers reliable power at a lower price than other renewable sources of power, GenCo has built a strong pipeline of customers in retail, data center and education spaces for mission critical applications As it seeks to expand its international presence, GenCo is interested in looking at Indian and Singapore data center power markets. This study established the true lifecycle cost of power for Data center operators in these two countries given that diesel generators are used as back up source of power to grid power. By positioning GenCo systems as base load systems with grid power as the back-up, considerable savings can be realized for the customer. Given the low cost of grid power in India and low restrictions on diesel generator operation the true costof power over a 10 Year time period is Rs14.6/KWh for the data center operator. As compared to this,the cost of power generated from a comparable sized GenCo system is Rs18.8/KWh, making it economically unviable for the data center operator to switch to GenCo systems. Lack of regulatory support such as capital equipment subsidies or renewable energy tax credits further compounds the lackof viability. GenCo systems can achieve cost parity in India if the equipment cost falls by 50% from the current levels. Even then, given lack of piped gas infrastructure in major parts of the country can be a severe show stopper for GenCo. High cost of grid power, regulatory thrust towards green data centers and high real estate costs are all factors that favor GenCo systems in Singapore data center power market. The true cost of power for a Singapore data center operator is $0.24/KWh as compared to $0.29/KWh from GenCo systems. It is therefore recommended to concentrate on entering Singapore data center market ahead of Indian market.