Global Green Data Centres Market - 2024-2031

Global Green Data Centres Market - 2024-2031

Global Green Data Centres Market reached US$ 57.84 billion in 2023 and is expected to reach US$ 160.87 billion by 2031, growing with a CAGR of 18.87% during the forecast period 2024-2031.

A green data center is a service facility that hosts servers for the storage, management, and distribution of data, utilizing energy-efficient technologies. These data centers abstain from outdated systems in favor of newer, more resource-efficient technologies. As the demand for data storage continues to grow, operators have observed an increase in the deployment of power and cooling systems. In this context, green or sustainable data centers present a viable solution for a more environmentally friendly future.

The escalating need for data storage is the primary factor driving the demand for green data centers. According to Huawei, the global demand for data centers is projected to increase by three to ten times in the next few years. Green data centers provide a practical and environmentally conscious solution for data storage and reduced energy consumption, while also offering a positive outlook for data center storage needs and an increase in new constructions due to regulatory requirements.

Consequently, the necessity to reduce operating expenses is expected to rise in the coming years. Furthermore, the growth of machine learning (ML), artificial intelligence (AI), big data, and the Internet of Things (IoT) will continue to elevate the power consumption of data centers worldwide. This factor is another significant driver for the green data center market, which is anticipated to expand throughout the forecast period.

North America dominated the market with a substantial share of 38.42%. This regional growth is primarily driven by the implementation of energy efficiency targets, compliance with regulatory requirements, and a commitment to sustainability initiatives. The increasing adoption of environmentally friendly practices across various industries, fueled by heightened environmental awareness, further contributes to this growth. Asia Pacific is projected to achieve the fastest Compound Annual Growth Rate (CAGR) during the forecast period. The robust growth in this region is attributed to rapid economic development, escalating data traffic, environmental concerns, and growing support for international sustainability programs.

Dynamics

Maximizing Energy Efficiency With ECO Mode In UPS Systems Is Expected To Boost The Market Growth:

The ECO mode, also known as ""Active Standby"" or ""Economy"" mode, represents the most energy-efficient operational mode for uninterruptible power supply (UPS) systems. This mode can achieve exceptional efficiency levels of up to 99%. In ECO mode, the bypass line (raw mains supply) is utilized to power the load, with the inverter remaining powered but inactive as long as the mainline is within acceptable tolerances. The primary advantage of ECO mode lies in the enhanced efficiency of the bypass line, which typically operates at 98-99% efficiency, compared to the standard online UPS efficiency of 93-97%. This efficiency improvement, ranging from 2-6%, can result in substantial cost savings. In large-scale facilities, even a 1% increase in efficiency can translate to annual savings of tens or even hundreds of thousands of dollars in energy costs.

There are two types of ECO modes available in the market: traditional UPS Eco Mode and advanced Eco Mode. The advanced ECO mode is preferred due to its rapid provision of clean energy to data center infrastructure. Innovations in UPS technology by leading vendors are driving the adoption of green data centers across various industry sectors.

Rapid Advancement Of Artificial Intelligence In Power And Cooling Technologies To Propel Market Growth:

The incorporation of emerging technologies, such as Artificial Intelligence (AI) and Machine Learning (ML), into green data centers facilitates the automation of various processes and the reduction of carbon footprints. As digital transformation accelerates across industries, the demand for data services is swiftly increasing. To meet these demands, data center operators are continuously seeking efficient power solutions, increased space, and a skilled workforce. These challenges are being addressed through the deployment of AI, in conjunction with IoT and ML, within their infrastructures. AI-based robots can predict power outages, enhance performance metrics, and lower maintenance costs. Furthermore, digital twins leveraging AI and ML assist data centers in minimizing their carbon footprint.

For instance, in May 2023, Huawei introduced the Fan Wall Chilled Water Cooling Solution and PowerPOD 3.0 at the Huawei Green Data Center Summit. The company launched AI-based power and cooling products in the Asia-Pacific market to enhance the sustainability of regional data centers. These developments exemplify market drivers that will support the adoption of green data centers..

Significant Investments In Existing Infrastructure:

The initial expenditure required to construct an energy-efficient green data center is substantially higher than that needed for a traditional data center. Companies are hesitant to allocate such large amounts to green data centers when they already possess conventional data centers, despite the fact that the Total Cost of Ownership (TCO) for green data centers is more favorable and long-term savings will eventually offset the initial investment. The high capital outlay is viewed as a major constraint in the green data center market. However, the rising costs of operating traditional data centers will drive the demand for green data centers due to their low operationals costs.

Segment Analysis

The global battery separator market is segmented based on component, enterprise size, end-use, and region.

Enhancing Media Content Management Through Green Data Center Solutions:

Media and entertainment companies are generating an unprecedented volume of high-resolution content. Managing this extensive array of unstructured data in a scalable and accessible manner poses a significant challenge. Consequently, these companies rely heavily on compute storage and related services, which demand substantial power resources. The rapid growth in the user base of Over The Top (OTT) platforms, such as Netflix and Amazon Prime, underscores the critical need for energy-efficient data centers to effectively serve customers.

Content delivery is intrinsically linked to the performance of the underlying infrastructure supporting the content delivery solutions. By leveraging green data center solutions, media companies can establish globally accessible content repositories at lower operational costs and available anytime and anywhere via desktops and smart devices, including tablets and laptops.

Geographical Penetration

Sustainable Data Center Development In Major Regions Through Adoption of Sustainability Strategies:

The expansion of mobile broadband, the growth of big data analytics, and the advancements in cloud computing are anticipated to complement the growth of the North America green data center market. The North American market could address some of its challenges by emulating operators in Europe, particularly in Norway, where developers have successfully retrofitted an operational facility to provide 3.5MW of excess heat into the Oslo heating system annually. Additionally, Facebook established the world’s first “green” data center in Luleå, Sweden, leveraging cold temperatures and a nearby hydroelectric dam as a source of clean power.

The growing demand for data storage and processing has driven the construction and expansion of data center facilities. Numerous businesses and service providers are either building new data centers or expanding existing ones to accommodate the increasing data load. For instance, United Airlines’ site in Chicago, Illinois, employs KyotoCooling® air-to-air heat transfer technology to maximize free cooling hours, thereby reducing energy consumption by 420 million kWh over a decade. Switch has designed and produced technology capable of eliminating chemicals from cooling systems, leading to an increase in water conservation by over 400% and saving more than 155 million gallons of water in three years.

The Asia Pacific Region (APAC) is one of the fastest-developing data center regions globally, driven by rapid digitalization and the growing demand for cloud-based services. Sustainability is increasingly becoming a key business imperative in APAC, as customers, shareholders, and the public demand accountability from corporations. Many countries in the region, including Singapore, are actively working on plans to build a low-carbon and climate-resilient future by developing renewable energy sources.

In February 2022, Fujitsu Ltd. advanced the development of energy-efficient photonics smart network interface cards (NIC) and CPUs to address the challenges of rising power consumption across data centers under the NEO program. This innovative solution supports next-generation green data centers by enhancing energy efficiency and capacity while decreasing latency, thereby contributing to a green society.

AI Impact Analysis:

Green data centers, empowered by AI technologies, are revolutionizing the digital infrastructure landscape with reduced environmental impact. AI optimizes energy consumption and cooling systems, slashing energy use and carbon footprints. These centers also embrace renewable energy like wind and solar power to cut fossil fuel reliance, crucial for mitigating climate change.

AI enhances data centers by optimizing power, cooling, and maintenance processes, cutting energy use and environmental harm. Predictive analytics and machine learning foresee issues and adjust systems preemptively, ensuring efficiency.

Smart cooling systems, backed by ML, excel in data center efficiency by dynamically adjusting to thermal conditions, minimizing energy use while ensuring optimal temperatures. ML predicts thermal conditions precisely, adjusting cooling resources efficiently over time.

Virtualization and energy-efficient hardware reduce energy waste by consolidating server use and optimizing resource allocation based on the real-time demand. AI-driven hardware design further boosts efficiency without compromising performance.

Autonomous systems manage data center operations independently, using predictive analytics to adjust resources and optimize efficiency. Intelligent automation streamlines tasks and adapts to changing conditions, minimizing energy use. Integrating renewable energy further reduces fossil fuel dependency, advancing sustainability in data centers.

Emerging trends and innovations in AI contribute significantly to enhanced energy efficiency in green data centers. Advanced AI algorithms, edge computing, and the integration of renewable energy sources are pivotal factors in striving towards net zero emissions:
- Advanced AI algorithms facilitate dynamic resource allocation, optimizing energy management in real-time with greater effectiveness.
- Edge computing decreases energy consumption by processing data closer to end-users, thereby reducing transmission losses.
- The integration of renewable energy sources utilizes AI for optimal allocation, resulting in a reduction of several million pounds of CO2 emissions annually.

Ongoing research and development play a crucial role in driving continuous improvements. These advancements enable data centers to adopt greener practices, enhance energy efficiency, and minimize environmental impact.

COVID-19 Impact Analysis

The ongoing trend, accelerated by COVID-19, has prompted many organizations to hasten the adoption of data center automation, driven by a desire to mitigate disease transmission risks both on-premises and in colocation settings. Despite the inherent limitations of data center automation, it appears probable that facilities will maintain reduced physical staffing levels even after the pandemic subsides. This shift towards a more hands-off approach to hardware in the post-COVID era is expected to bolster the prevalence of private cloud and managed service models, particularly where full cloud migration is impractical. Chief Information Officers (CIOs) will increasingly appreciate the advantages of outsourcing the maintenance of their operational hardware.

Faced with budgetary constraints, enterprises are likely to become more adept at creatively repurposing hardware for internal needs. Maximizing the lifespan of products and materials aligns with the principles of the circular economy, particularly in green data center initiatives. Organizations such as the electronics manufacturing consortia iNEMI advocate for the internal reuse of critical enterprise hardware, such as hard drives, citing substantial benefits in terms of reducing carbon emissions.

Russia-Ukraine War Impact Analysis

The energy sector remains significantly impacted by Russia’s invasion of Ukraine, which initiated a global energy crisis in February 2022. Although energy prices have retreated from their peak levels over the past two years, regional variations persist. Many parts of the world still experience elevated prices, hindering economic growth, straining household and business finances, and complicating efforts to expand electricity access.

In Ukraine, the energy sector faces continued adversity as it confronts a second consecutive winter on the front lines of conflict. With plummeting temperatures, Russia has resumed extensive military operations targeting critical energy infrastructure, resulting in severe damage and prolonged disruptions to electricity and heating supplies for Ukrainian citizens. Despite recent enhancements to Ukraine’s air defense capabilities, ongoing Russian assaults necessitate additional resources to address persistent structural challenges within the country’s power sector.

For data centers across Europe, the most pronounced impacts are expected in the form of escalated power expenditures. Power costs constitute a primary operational expense for data centers, and European stakeholders—from consumers to service providers—were already grappling with heightened costs before the Ukrainian conflict. European power prices surged by as much as 200% in 2021, with even greater increases observed in Nordic countries. A pre-existing natural gas shortage compounded the situation, with European benchmark prices soaring from €20 ($22) per MWh in early 2021 to €180 per MWh by December of the same year. Maintenance-related reductions in Norwegian gas supplies, heightened Chinese demand, and diminished Russian deliveries contributed to this shortage. The conflict in Ukraine is expected to exacerbate disruptions in natural gas and oil supplies, intensifying pressures on electricity prices. Additionally, potential oil supply interruptions could lead to increased diesel expenses for data centers reliant on backup generators.

By Components
• Solution
Monitoring & Management System
Cooling System
Networking System
Power Systems
Others
• Services
Installation & Deployment
Consulting
Support & Maintenance

By Enterprise Size
• Large Enterprises
• Small & Medium Enterprises (SMEs)

By End-use
• BFSI
• Media and Entertainment
• Retail
• IT & Telecom
• Healthcare
• Manufacturing
• Government & Defense
• Others

By Region
• North America
U.S.
Canada
Mexico
• Europe
Germany
UK
France
Italy
Russia
Rest of Europe
• South America
Brazil
Argentina
Rest of South America
• Asia-Pacific
China
India
Japan
Australia
Rest of Asia-Pacific
• Middle East and Africa

Key Developments
• In May 2023, Huawei introduced the Fan Wall Chilled Water Cooling Solution and PowerPOD 3.0 during the Huawei Green Data Center Summit. These AI-based power and cooling products were launched specifically for the Asia Pacific market, aiming to enhance the sustainability of regional data centers.
• In June 2023, Cyberlink, an ICT infrastructure service provider, formed a partnership with Green, a data center provider, to expand its data center backbone. This collaboration enabled Cyberlink to extend its infrastructure services to three environmentally friendly data centers located in Lupfig, Dielsdorf, and Schlieren.
• In December 2023, Liberation Technology Services (LTS) partnered with E-New Data Corp. to pioneer a state-of-the-art, environmentally friendly data center scheduled for completion in 2024. This partnership promises significant reductions in power and water consumption compared to traditional data centers.
• In May 2023, Sonic Edge, a modular data center firm based in the U.K., teamed up with Deep Green to offer customers reduced power costs through immersion cooling technologies. This alliance will support Sonic Edge's initiative to deploy 50 new HPC/EdgePods across the U.K. by 2024.
• In February 2023, Micro Hub launched a solar-powered data center in Dubai in collaboration with technology leaders such as Dell Technologies, Microsoft, Huawei, and VMWare. This data center operates entirely on renewable energy and incorporates cutting-edge technologies including Internet of Things (IoT), digital twin technologies, cybersecurity, and Artificial Intelligence (AI).

Competitive Landscape

The major global players in the market include ABB Ltd., Asetek, Inc., Delta Electronics, Inc., Digital Realty Trust, Cisco Systems, Inc., Dell Technologies, Inc., Equinix, Inc., Fujitsu Ltd., General Electric, Hewlett Packard Enterprise Company, Huawei Technologies Co., Ltd., Hitachi, Ltd., International Business Machines Corporation, Schneider Electric, Siemens AG.

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Target Audience 2024
• Manufacturers/ Buyers
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