Global data center cooling market experiences massive growth as demand for AI & ML applications surges

In a period of remarkable expansion, the global data center cooling market is witnessing unprecedented growth. The increasing demand for artificial intelligence (AI) and machine learning (ML) applications among data center operators has accelerated the need for effective cooling systems. Additionally, the surge in self-built data center deployments by hyperscale operators worldwide has propelled the demand for efficient cooling infrastructure.

Cooling systems account for approximately 15% to 25% of the overall investments in data center construction. The major power consumers within data centers are the IT infrastructure and cooling systems. To align with the growing focus on carbon neutrality, data center operators prioritize innovation when selecting cooling systems that offer lower power consumption, enhanced efficiency, and reduced carbon emissions.

As a result, several operators have recently acquired energy-efficient and innovative cooling infrastructure solutions which can decrease power consumption by up to 50%. The rise in water consumption and power usage, driven by higher rack capacities, has further fueled the demand for efficient cooling systems in the global data center cooling market.

The global data center cooling market size was $8.73 Billion in 2022. The market will reach $12.64 billion by 2028, growing at a compound annual growth rate of 6.36% from 2023 to 2028.

Global data center cooling market report key insights

• Data centers adhere to cooling standards set by organizations like ASHRAE, which provide industry-standard guidelines and recommendations for designing, adopting, and operating cooling systems and equipment to ensure optimal cooling.
• Operators actively seek cost-effective and sustainable solutions to improve their cooling systems while conserving space and reducing power consumption.
• Hybrid liquid cooling, plant-based immersion cooling, waterless cooling, and river water cooling are among the efficient solutions being considered by data center operators to reduce capital expenditure (CAPEX) and operational expenditure (OPEX).
• Computer Room Air Conditioning (CRAC) and Computer Room Air Handler (CRAH) units currently dominate the cooling systems market, accounting for approximately 35% of the overall market share. CRAH units are gaining popularity among operators due to their compressor-less operation, resulting in higher efficiency and lower power consumption than CRAC units. This makes CRAH units an excellent choice for operators aiming to incorporate sustainability into their facilities, and their demand may drive the market during the forecast period.
• Furthermore, operators are also focusing on the sustainability aspect of immersion cooling systems by utilizing eco-friendly fluids. One such fluid is Cargill’s NatureCool, a carbon-neutral plant-based fluid that can be employed for immersion cooling in data centers and other industrial IT applications.
• Aligned with the sustainability trend, Nanyang Technological University (NTU Singapore), the National University of Singapore (NUS), and stakeholders in the Singapore data center market have established a test-bed data center facility. This facility aims to develop sustainable and innovative cooling systems specifically designed for tropical regions to reduce carbon footprint and energy consumption.

Geographical analysis

The North American market is at the forefront of global data center industry growth, benefitting from the early availability and adoption of innovative technologies and investments from colocation service providers, hyperscale data center operators, enterprises, and government agencies. This region is a driving force and an incubator for technological innovations in the data center space. Major contributors to market growth in North America include Facebook, Google, Equinix, Digital Realty, Compass Datacenters, Cologix, Vantage Data Centers, NTT Global Data Centers, QTS Realty Trust, CoreSite, CyrusOne, and Switch.

According to the report, North America also leads the global data center cooling market, with the United States at the forefront, followed by Canada. Colocation providers, hyperscale data center operators, enterprises, and government agencies in the region are investing billions in data center facilities and adopting redundant power backup infrastructure. In 2022, the United States accounted for approximately 25% of global data center investments in the number of facilities and emerged as one of the largest contributors to the global data center power market. Key data center markets in the US include Virginia, Texas, California, Illinois, Georgia, Nevada, and Oregon.

WRITTEN BY

Team Eela

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