Powergrid spins off telecom business, agrees to enter data center business

Power Grid Corporation of India Limited is spinning off its telecom vertical into a new wholly-owned subsidiary, Powergrid Teleservices Ltd, with a view to adopting a “focused approach” and moving up the value chain, a senior company official said.

The move by the state-run power transmission major comes on the heels of the telecom industry expanding its 5G services across the country to bring about a business transformation that could contribute 2 percent of the country’s GDP.

The state-owned power transmission specialist has also received approval from the Central Electricity Regulatory Commission (CERC) to operate data centres.

“Subject to obtaining all regulatory approvals, Powergrid’s telecom division will be transferred to a new subsidiary, Powergrid Teleservices, to provide greater impetus to the business and move up the value chain by entering the data center business. The regulatory approval process is ongoing,” said Powergrid Executive Director (Telecom) B Vamsi Rama Mohan told PTI during INFOCOM 2022 organized by ABP Group.

He also said pilots demonstrating mobile BTS and FM radio transmissions on high-voltage transmission towers “have shown promising results”.

“With the focus on high-speed data networks across the country, the telecommunications business has huge potential for growth,” he said.

Telcos have announced plans to deploy 5G nationwide within the next two years, and Powergrid is “ready” to help Telcos (telcos) deploy their 4G or 5G base stations on high-voltage transmission towers, as PGCIL has “one of the largest Fiber-optic terrestrial network providing communication services”.

“We have one of the largest fiber optic networks at 76,000km. The pilot demonstration of 4G/5G BTS on high voltage towers has had promising results and is running smoothly. This gives us confidence that Powergrid can now take advantage of its 200,000 A strong network of towers spans the country, helping the telco to deliver voice and data services to every village in the country,” said PGCIL CGM (Telecom) D Yadav.

Powergrid will provide a “one-stop solution for telecom operators with highly reliable power supply, tower to host antenna and infrastructure, fiber backhaul from transmission line and unrivaled coverage”, even on widely used transmission tower bases The same is true for remote areas of the facility, officials said.

Talking about the data center, Mohan said, “CERC has approved Powergrid to use the remaining land at the substation to build and operate a data center under PowerTel.

“The first data center as a pilot is expected to be built near Delhi with a capacity of 250 racks and will be increased to 1000 racks. A detailed business model for the data center is being worked out.”

The telecom business is relatively small in terms of overall Powergrid revenue, but “the business environment is very conducive to leapfrogging,” Mohan said.

Referring to the national long-distance operation, Mohan said: “Through the interconnection agreements with neighboring countries such as Nepal, Bangladesh and Bhutan, we are using it to provide fiber optics to these countries.”

Powergrid has a large-scale transmission network of 176,000 kilometers, which provides energy to the whole country.

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