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India’s digital transformation is fuelling a surge in data centre development and with it, a growing appetite for construction materials that can keep pace. Steel is emerging as a compelling alternative to traditional concrete, offering speed, sustainability, and design flexibility. Yet, its adoption is not without hurdles.
India’s data centre capacity is expected to exceed 4,500 MW by 2030, supported by an investment of USD$25bn, which creates a significant growth opportunity. The construction of data centres depends heavily on structural steel used in the building’s framework, raised flooring, cladding, and the supports for cooling systems. Large-scale hyperscale data centres can require over 20,000 tonnes of steel, approximately, 2,500 to 3,000 kgs per Sqm with approximately double that amount needed for AI Data centres, due to their heavy structural loads, multiple floors, and dense internal equipment.
Steel is gaining traction in India’s data centre sector for three key reasons, with Ameya Gumaste, Country Lead for India, highlighting the growing momentum and the positive impact it can have on cost and programme, as outlined below.
Prefabricated steel components enable faster assembly, reducing project timelines significantly. Precision manufacturing supports efficient layouts and optimised airflow, essential for cooling-intensive environments.
PEBs in India are rapidly gaining popularity for their ability to cut construction time by up to 50% across various building types. However, the actual time reduction depends on factors such as project scale, design complexity and site conditions among others.
Steel’s modular nature allows for scalable, adaptable designs. As data centre technologies evolve, steel structures can be reconfigured or expanded with minimal disruption.
Components can also be reused or repurposed, extending their lifecycle and contributing to significant environmental benefits, including reduced water usage and waste.
Steel produced via electric arc furnaces (EAF), which rely heavily on recycled scrap, offers a lower-carbon alternative to traditional blast furnace methods.
This aligns with India’s Green Steel Taxonomy, introduced in December 2024, and supports corporate ESG goals. EAF steel production can cut carbon emissions by up to 75% compared to traditional methods.
With over 85% of steel recyclable at end-of-life, it’s a strong fit for circular construction models. For data centers, concrete can make up around 40% of a project’s carbon footprint, while steel both for reinforcement and the structure itself typically accounts for about 10% of construction.
By leveraging mass manufacturing capability with precision fabrication, the amount of onsite labour can be reduced. This has an impact on labour costs, program times and build accuracy. An added benefit is reduced waste, and removal of waste, on site from more accurate custom manufactured components which don’t require as much alteration on site.
Steel does still carry certain limitations that must be factored into decision-making. Ensuring compliance with seismic and fire resistance codes can introduce additional costs, such as the need for fireproofing, while India’s limited Grade A supply chain adds complexity in designing, fabricating, and erecting pre-engineered data centre buildings.
Compared with concrete, which has advanced thermal resistance and supports more effective indoor temperature regulation, steel continues to require supplementary insulation due to its high thermal conductivity.
Cost is also a consideration, as concrete benefits from locally sourced materials and lower labour requirements, making it more economical, whereas steel typically involves higher material, fabrication, and erection expenses. Floor structural grid layouts can also create design limitations and added costs for steel, while concrete often provides greater spans and stronger cost value.
For these reasons, hybrid construction is often the preferred model. Rather than choosing exclusively between steel and concrete, hybrid systems typically use concrete for foundations and core walls, with steel employed for framing, roofing, and future expansions, an approach that balances speed, resilience, and sustainability.
With over 50 years of global experience, Linesight partners with clients to navigate construction complexities through practical, results-driven support. We provide benchmarking and cost intelligence to guide investment decisions, develop procurement strategies to mitigate supply chain risks, and advise on material selection with a focus on cost, performance, and sustainability. We also support the adoption of hybrid construction models that optimise speed, security, and cost, helping clients deliver projects efficiently and with confidence.
Steel isn’t a universal solution but in the right context, it offers unmatched advantages for fast, scalable, and sustainable data centre builds. As India’s construction landscape evolves, steel’s role is set to expand, driven by global ESG goals, innovation, and the growing demand for digital infrastructure.
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