Europe Sustainable Data Center Market - Industry Outlook & Forecast 2024-2029

Europe Sustainable Data Center Market - Industry Outlook & Forecast 2024-2029

The European sustainable data center market by investment is expected to grow at a CAGR of 11.32% from 2023 to 2029.

KEY TRENDS

Increased Focus on Renewable Energy Sources

• The major hyperscale operators, such as AWS, Google, Microsoft, and Apple, are procuring renewable energy for their data centers. For instance, AWS meets 85% of its energy requirements from renewable energy. Google and Apple meet 100% of their energy requirements for data centers from renewable energy. Microsoft aims to power all data centers with 100% renewable energy by 2025.
• Colocation operators such as Equinix, Iron Mountain, CyrusOne, Digital Realty, maincubes SECURE DATACENTERS, and others are proactively signing Power Purchase Agreements (PPAs) and procuring renewable energy to power their data center facilities to meet their sustainability goals. Digital Realty meets 100% of the energy requirements for European data centers from renewable energy.

Emerging Trends to Power Data Centers

• Hydrotreated Vegetable Oil (HVO) fuel is increasingly being used in the Europe sustainable data center market as part of the push toward sustainability and reduced carbon footprint. For instance, in December 2023, Kao Data’s second data center in Harlow, UK, is operational. The KLON-02 data center is designed and built with a strong focus on sustainability and efficiency. The facility will run entirely on certified renewable energy and use hydrotreated vegetable oil for its backup generators.
• Fuel cells are emerging as a promising solution for powering data centers due to their numerous advantages. Fuel cells can revolutionize the data center market by providing clean, efficient, and reliable power. For instance, in August 2024, Equinix is looking into using hydrogen fuel cells at its data center in Dublin, Ireland.
• Data center operators in regions with an uncertain power supply due to factors such as natural disasters and power fluctuations can adopt microgrids and smart grids.

Government Push Toward Sustainability

• The European government made significant strides in achieving its goals outlined in the sustainability plan. The European Union has set strict rules to cut carbon emissions. The EU’s Green Deal aims for carbon neutrality by 2050. Data centers must follow energy efficiency standards and use more renewable energy. The Energy Efficiency Directive (EED) requires large businesses, including data centers, to regularly check their energy use and improve their energy management.
• The UK government has committed to Net Zero Emissions by 2050, thus compelling all data center operators to become carbon neutral. The Danish government plans to establish two energy islands by 2030, expanding Denmark’s renewable energy capacity by over 4 GW.

SEGMENTATION INSIGHTS

Electrical Infrastructure

The electrical and power infrastructure landscape is undergoing significant changes and transformations from traditional uses. The market is now more focused on enhancing reliability and boosting efficiency. For instance:

• AWS will use HVO across all its European data centers. It has already replaced diesel with HVO in Ireland.
• Microsoft partnered with Eaton, which will fit all of Microsoft’s data centers with grid-interactive UPS.
• Companies are also considering using liquid metal batteries, sodium-ion batteries, and nickel-zinc batteries, which are in the introductory stage and may be revolutionary soon for the data center industry.

Mechanical Infrastructure

Europe to witness increased advanced cooling technologies. Most companies have deployed free cooling and zero-water cooling, leveraging the cold temperature of the region.

• The Copenhagen data center of Digital Realty employs a free-cooling system that integrates cold aisle containment and adiabatic cooling techniques.
• NTT DATA Berlin 2 data center facility is equipped with N+1 redundancy of water-based cooling systems supported by free cooling and has cold-aisle containment.

General Construction

Adopt sustainable and innovative construction design/material in data centers in Europe.

• Hyperscale operators such as AWS, Microsoft, Apple, and Google are taking the lead in using sustainable materials to construct data centers.
• Companies are introducing technologies such as green concrete, modular data centers, and more in their data center construction.
• Data4 has been using low-carbon concrete in its data centers since 2021.
• District heating is prevalent in Europe, majorly in Nordic countries, followed by Western Europe, where data center firms transfer heat generated from data centers to nearby offices, residential places, swimming pools, and others.

GEOGRAPHICAL ANALYSIS

• The Nordic region is suitable for green data center development as there is no need for water-based cooling, and Nordic countries source maximum power supply from renewable energy and support Europe’s sustainable data center market growth.
• Site selection for data centers across Europe will mostly depend on access to renewable energy.
• Spain, Portugal, Greece, and others are on the back of investments in renewable energy, with easy availability of space in markets in comparison to Germany, the UK, and other crowded markets.
• Western Europe and the Nordic region will remain hotspots for data center development, with more companies flocking to the Europe sustainable data center market.
• Most data centers in Central and Eastern European countries invest in renewable energy, especially Poland, Czechia, Romania, and Austria, to reduce PUE from 1.5 to around 1.3 or lower. These countries offer attractive opportunities for data center investors during the forecast period.

Segmentation By Geography

• Europe
• Western Europe
• UK
• Germany
• France
• Netherlands
• Ireland
• Switzerland
• Other Western European Countries
• Nordics
• Sweden
• Denmark
• Norway
• Finland & Iceland
• Central and Eastern Europe
• Poland
• Other Central & Eastern European Countries

VENDOR LANDSCAPE

• The Europe sustainable data center market is rapidly evolving as organizations prioritize energy efficiency and sustainability.
• Google is among the top operators in the data center market, known for its commitment to sustainability and energy efficiency. The company aims to run all its data centers on carbon-free energy by 2030, and it uses AI to optimize cooling systems, reducing energy use by up to 30%.
• Renewable energy companies such as Orsted, Engie, GreenYellow, Enel Group, and many more are supplying renewable energy to data center operators. These companies are setting up new plants exclusively for data center companies, thus providing clean power sources for data center companies. For instance, Google has entered into a Power Purchase Agreement (PPA) with Engie to acquire 118 MW of power from wind energy in Belgium.
• Colocation vendors such as Equinix, Digital Realty, Vantage Data Centers, CyrusOne, STACK Infrastructure, Colt Data Centre Services, and hyperscale vendors such as Microsoft, AWS, Google, Apple, Meta, and others are adopting the latest and sustainable technologies across the data center facilities.

Data Center Investors

• Ada Infrastructure
• AWS
• Apple
• AtlasEdge
• Atman
• atNorth (Partners Group)
• AQ Compute
• Aruba
• Bahnhof
• Beyond.pl
• Bulk Infrastructure
• Colt Data Centre Services (Colt DCS)
• Conapto
• CloudHQ
• CyrusOne
• Data4
• Digital Realty
• EdgeConneX (EQT Infrastructure)
• Equinix
• Global Switch
• Google
• Green
• Green Mountain (Azrieli Group)
• Iron Mountain
• Kao Data
• Keppel Data Centres
• LCL Data Centers
• maincubes SECURE DATACENTERS
• Meta (Facebook)
• Microsoft
• Nautilus Data Technologies
• nLighten
• NorthC
• NTT DATA
• Orange Business
• OVHcloud
• Penta Infra
• Prime Data Centers
• Pure Data Centres
• STACK Infrastructure
• Start Campus
• Switch Datacenters
• Telehouse
• Vantage Data Centers
• Verne
• VIRTUS Data Centres
• Yondr

Renewable Energy Providers

• ACCONIA Energia
• Better Energy
• Bryt Energy
• Conrad Energy
• Datafarm Energy
• EDP Renewables
• Eneco
• Enel Group
• Engie
• ERG
• European Energy
• FuturEnergy Ireland
• GreenYellow
• HDF Energy
• Iberdrola
• ib vogt
• Ilmatar Energy
• Neoen
• NTR
• Ørsted
• Power Capital Renewable Energy
• Repsol
• RWE Renewables
• ScottishPower
• Shell
• SSE Renewables
• TotalEnergies

KEY QUESTIONS ANSWERED:

1. How big is the Europe sustainable data center market?

2. What are the key trends in the European sustainable data center market?

3. Which region dominates the Europe sustainable data center market share?

4. How many MW of power capacity is expected to reach the Europe sustainable data center market by 2029?

5. What is the growth rate of the Europe sustainable data center market?