The data centre cooling market is projected to expand driven by demand for efficient cooling solutions and environmental regulations, focussing on efficient operations despite challenges like high costs and a strong emphasis on energy-efficient solutions.
As the global data centre cooling market expands, the need for effective cooling solutions in data centres is increasing. As data centres become larger and more complex, maintaining optimal temperatures is essential for the performance and longevity of equipment, leading to the adoption of advanced cooling technologies. Customers now demand data centres that provide high levels of security, reliability, and scalability to support their growing digital requirements. Additionally, there is a strong emphasis on energy-efficient solutions that help minimise operational costs and reduce environmental impact.
The global shift towards remote work and digital transformation is accelerating the demand for data centre services. IoT devices, artificial intelligence, and 5G technology produce massive amounts of data that must be stored and processed in data centres. The rise in e-commerce and online and social media platforms is impacting the need for data centre infrastructure to support such digital services. The popularity of social media and content streaming services like Netflix and Hotstar is another factor propelling data centre growth.
The increasing volume of data generated by businesses and individuals has spurred the establishment of big data centres, intensifying the demand for efficient cooling systems. Additionally, environmental regulations and the need for energy-efficient operations have driven the adoption of innovative cooling solutions, which can minimise the carbon footprint of data centres.
According to research by Market Research 365, the data centre cooling market will grow from its current value of USD 16.2 billion to over USD 61.1 billion by 2035, growing at a CAGR of around 18.2 percent until 2035. Further, revenue in the data centre market, at US$416.10 billion in 2024, is increasing to show an annual growth rate of 8.45 percent from 2024 to 2029, resulting in a market volume of US$624.10 billion by 2029, as per Statista Market Insights.
Challenges
Despite the optimistic growth outlook, the data centre cooling market has challenges. One of the restraints is the high initial cost of implementing advanced cooling technologies. It can deter small and medium-sized enterprises from adopting these solutions. Moreover, the complexity of integrating new cooling systems into existing data centre infrastructure poses technical challenges, leading to operational disruptions during the transition phase.
Amidst the challenges, the data centre cooling industry presents several opportunities for innovation and growth. The development of scalable and modular cooling solutions has the potential to address the financial barriers faced by smaller enterprises, allowing them to gradually adopt efficient cooling. The rising interest in liquid cooling and direct-to-chip solutions opens opportunities for companies to provide cutting-edge technologies that enhance cooling efficiency and reduce energy consumption.
Growth
Cloud service providers are key drivers of data centre demand and growth. As businesses of all sizes migrate towards cloud-based solutions for applications and data storage, the need for data centres to house and manage this growing information becomes dominant. The Indian government’s push towards digitalisation is impacting Public Sector Undertakings. As these government agencies embrace digital initiatives to improve efficiency and service delivery, their demand for data centre space will rise significantly. The government is contributing to the growth of data centres by creating a supportive environment. Their emphasis on advancing digital infrastructure is transformative, involving efforts to improve national connectivity and establish a more resilient network for data transmission.
Asia-Pacific is experiencing a surge in colocation data centres as businesses look to outsource their IT infrastructure to third-party providers. In Europe, there is a focus on sustainability, with data centres adopting green technologies such as renewable energy sources and efficient cooling systems.
Electricity consumption by 2026
Updated regulations and technological improvements, including on efficiency, will be crucial to moderate the surge in energy consumption from data centres. Global electricity demand from data centres could double towards 2026. We estimate that data centres, cryptocurrencies, and artificial intelligence (AI) consumed about 460 TWh of electricity worldwide in 2022, almost 2 per cent of the total global electricity demand. Data centres are a critical part of the infrastructure supporting digitalisation and the electricity infrastructure that powers them. The ever-growing quantity of digital data requires an expansion and evolution of data centres to process and store it. Electricity demand in data centres is mainly from two processes, with computing accounting for 40 per cent of the electricity demand of a data centre. Cooling requirements to achieve stable processing efficiency make up another 40 per cent. The remaining 20 per cent comes from other associated IT equipment
Cooling solutions
The rise of AI and high-performance computing has increased the need for cooling systems to prevent device overheating. The data centre cooling market is based on cooling techniques, solutions, and end-users. Cooling techniques encompass air- and liquid-based cooling, with benefits and drawbacks. Solutions include precision air conditioning, containment systems, and chilled water systems. End-users of data centre cooling solutions range from IT and telecom companies to government organisations, each with specific cooling requirements dictated by the scale and nature of their data centre operations.
Research helps increase efficiency and reduce energy consumption in data centres. The primary drivers of data centre electricity demand are the cooling systems and the servers, each typically accounting for 40 percent of the total consumption. The high-efficiency cooling systems reduce electricity demand in data centres by 10 percent. Other cooling research shows that a 20 percent reduction in consumption is achieved when operating with direct-to-chip water cooling and specific low viscous fluids to cool all other components. Google reported using its DeepMind AI to reduce the electricity demand of their data centre cooling systems by 40 percent.
Investments
Investments in the market are utilised for research and development of innovative cooling solutions. Startups and established players channel resources into designing energy-efficient and sustainable cooling technologies that cater to the evolving needs of modern data centres. Additionally, investments in partnerships and collaborations between cooling solution providers and data centre operators facilitate the integration of advanced cooling systems into existing setups.
In conclusion, the data centre cooling market is undergoing a significant transformation driven by the surge in data generation, energy efficiency concerns, and technological advancements. While cost and integration complexities exist, the market offers ample opportunities for businesses to introduce innovative cooling solutions catering to diverse data centre requirements. As the industry evolves, stakeholder collaboration and an emphasis on sustainability will be critical in designing the future of data centre cooling.
The Major operating players in the data centre cooling market are Air Enterprises, Asetek, Inc., Climaveneta, Coolcentric, Fujitsu, NTT Limited, Schneider Electric, STULZ GMBH, Rittal GmBH & Co. KG, and Hitachi, Ltd.
Compiled from sources:
www. cbre.co.in
Electricity 2024: analysis and forecast to 2026
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