Data Privacy Risks for Energy, Utilities and Smart Infrastructure Providers Under India’s DPDP Regime: Smart Meters, Consumption Data and Public Trust

Posted On - 9 February, 2026 • By - Aniket Ghosh

Introduction: When Utilities Become Data Platforms

India’s energy and utilities sector is undergoing a fundamental transformation. Traditional electricity, gas and water utilities once characterised by manual metering and periodic billing are rapidly adopting smart meters, IoT-enabled grids, digital billing platforms, predictive analytics and real-time monitoring systems.

Electricity distribution companies (DISCOMs), renewable energy providers, EV charging operators, city gas distributors and smart city authorities today process:

  • Household consumption and usage patterns
  • Real-time location and grid interaction data
  • Customer identity and KYC information
  • Payment, subsidy and billing histories
  • Device and infrastructure telemetry linked to individuals

Unlike discretionary consumer services, access to energy and utilities is essential. Consumers cannot meaningfully opt out of data collection without forfeiting basic services. This structural asymmetry places energy and utility providers under heightened data privacy risks and governance expectations.

With the enactment of the Digital Personal Data Protection Act, 2023 (“DPDP Act”) and the Digital Personal Data Protection Rules, 2025 (“DPDP Rules”), India has introduced a statutory framework that directly affects:

  • Smart metering and AMI deployments
  • Public–private utility models
  • Smart city and infrastructure projects
  • Government–citizen data relationships

Applicability of the DPDP Act to Energy and Utility Providers

A. Entities Covered

The DPDP Act applies to any entity processing digital personal data, including:

  • Electricity distribution companies (public and private)
  • Renewable energy and rooftop solar providers
  • City gas distribution companies
  • Water and waste utilities using digital systems
  • EV charging infrastructure operators
  • Smart city and urban infrastructure authorities
  • IoT and grid management technology vendors

Both state-owned utilities and private operators fall within the scope of the Act.

B. Utilities as Data Fiduciaries

Utilities and infrastructure operators typically qualify as data fiduciaries, as they determine:

  • What consumer data is collected
  • How consumption data is processed and analysed
  • Whether data is shared with government agencies, contractors or partners
  • Retention and monetisation strategies

Technology vendors namely meter manufacturers, IoT platform providers, and cloud hosts usually act as data processors, though primary accountability remains with the utility or authority. Large DISCOMs and smart city authorities may be designated as Significant Data Fiduciaries (SDFs) due to:

  • Scale of population-level data processing
  • Continuous monitoring of households
  • Potential harm from misuse or breach

Smart Meter and Consumption Data: The Core Privacy Risk

A. What Data Do Smart Meters Collect?

Advanced metering infrastructure (AMI) enables collection of:

  • Real-time or near-real-time energy consumption
  • Time-of-use patterns
  • Load profiles and peak usage
  • Remote connect/disconnect data
  • Device identifiers and location data

When linked to an identifiable household or individual, such data constitutes personal data under the DPDP Act.

B. Why Consumption Data Is Highly Sensitive

Energy usage data can reveal:

  • Daily routines and occupancy patterns
  • Work-from-home behaviour
  • Religious practices and lifestyle choices
  • Absence from home (security risk)

Granular consumption data, especially when collected continuously, creates non-obvious but serious risks of harm.

Under the DPDP Act, consent must be free, informed, specific, unambiguous, and capable of withdrawal. In utility contexts, this raises a critical issue: can consent be “free” where electricity, water or gas access depends on data processing?

Regulators are likely to scrutinise:

  • Blanket consent clauses in connection agreements
  • Non-transparent smart meter deployments
  • Absence of meaningful notice to consumers

B. DPDP Rules: Notice Obligations

The DPDP Rules require utilities to provide clear notice disclosing:

  • Categories of personal data collected (including consumption data)
  • Purpose of processing (billing, grid management, analytics)
  • Data sharing with government bodies or vendors
  • Retention periods
  • Grievance redressal mechanisms

Technical or legalistic notices that consumers cannot reasonably understand may be deemed non-compliant.

Purpose Limitation and Secondary Use of Utility Data

A. Billing vs Analytics and Monetisation

While collection of consumption data for Billing, Load balancing, and Outage management is generally defensible, utilities increasingly use data for:

  • Demand forecasting
  • Targeted energy efficiency programs
  • Cross-selling of services
  • Smart city analytics

Under the DPDP Act, such secondary use must be purpose-limited and transparently disclosed and may require fresh consent.

B. Data Sharing with Third Parties

Utilities often share data with:

  • Metering and analytics vendors
  • Government departments
  • Research institutions
  • Infrastructure partners

Absent clear contractual safeguards and purpose limitation, such sharing exposes utilities to enforcement risk.

Government Access, Exemptions and Citizen Trust

A. State Functions and Exemptions

The DPDP Act contains exemptions for processing by the State for certain functions. However, exemptions are not blanket permissions.

Utilities and smart city authorities must still:

  • Document legal basis for data sharing
  • Limit disclosure to necessity
  • Maintain accountability and security controls

Over-broad or informal data sharing can erode public trust and invite legal challenge.

B. Public–Private Partnerships (PPPs)

In PPP models, ambiguity often exists around:

  • Who is the data fiduciary
  • Who provides notice and obtains consent
  • Who bears breach and enforcement liability

Clear allocation of roles is essential to avoid regulatory gaps.

Cybersecurity, Infrastructure and Breach Risk

A. Utilities as Critical Infrastructure

Energy and utility systems are critical infrastructure. Data breaches or cyber incidents can:

  • Compromise grid stability
  • Enable physical sabotage
  • Endanger public safety

Under the DPDP Act and Rules, personal data breaches must be notified to:

  • The Data Protection Board of India
  • Affected individuals

This applies even where incidents originate from technical failures or cyberattacks.

B. Compound Risk: Data + Infrastructure

Breaches involving consumption and location data may:

  • Enable targeted crime
  • Undermine public confidence
  • Trigger multi-agency investigations

The intersection of privacy and national security heightens enforcement sensitivity.

Cross-Border Data Transfers in Utility Technology

Smart grid and analytics platforms often rely on:

  • Overseas cloud infrastructure
  • Global analytics engines
  • Foreign OEM support systems

Under the DPDP Act, cross-border transfers are permitted only to government-notified jurisdictions, requiring utilities to:

  • Map data flows
  • Monitor notifications
  • Prepare localisation or segmentation strategies if required

Penalties and Enforcement Exposure

A. Monetary Penalties

The DPDP Act empowers penalties up to INR 250 crore per contravention, assessed based on:

  • Nature and sensitivity of data
  • Scale of processing
  • Duration and recurrence
  • Mitigation measures taken

Population-scale data processing significantly increases exposure.

B. Public Law and Reputational Consequences

Beyond penalties, utilities may face:

  • Regulatory directives to alter systems
  • Public interest litigation
  • Parliamentary or audit scrutiny
  • Loss of citizen trust

For public utilities, reputational harm can have political and governance consequences.

Compliance Roadmap for Energy and Utility Providers

1. Data Mapping and Classification: Identify consumption, identity and infrastructure-linked data flows.

2. Transparent Consumer Communication: Develop clear, accessible notices for smart meters and digital services.

3. Purpose Limitation Controls: Separate core utility functions from analytics and commercial uses.

4. Vendor and PPP Governance: Update contracts with technology vendors and PPP partners.

5. Incident Response and Resilience: Integrate privacy compliance into cybersecurity and disaster recovery planning.

Conclusion: Privacy as a Component of Sustainable Infrastructure

As India builds smarter grids and digital infrastructure, privacy will become a core component of sustainability and public trust. The DPDP Act and Rules make it clear that efficiency, innovation and public interest do not justify unchecked data collection or opaque analytics.

Energy and utility providers that embed privacy-by-design, respect proportionality and maintain transparent governance will be best positioned to deliver resilient, trusted infrastructure in India’s digital future.