Asia Pacific Data Center Cooling Market - Growth, Trends, COVID-19 Impact, Forecasts (2022 - 2027)

Asia Pacific Data Center Cooling Market - Growth, Trends, COVID-19 Impact, Forecasts (2022 - 2027)

The Asia Pacific Data Center Cooling Market is expected to grow at a CAGR of 11.7% over 2021 to 2026. Due to the surge in internet usage and the number of data centers due to enormous computational requirements by AI and Media applications in the APAC region, the Data Center Cooling Market has a massive growth. According to Internet World Stats (IWS), as of May 2020, with a penetration rate of 55.1% and nearly 2.4 billion Internet users, Asia-Pacific accounted for 50.9% of the global internet users. As of 2021, China ranked first with around 1034.32 million internet users, while India achieved second place with 845.68 million internet users.

Key Highlights

• According to IEA, hyperscale data centers have doubled their energy demand from around 31.11 terawatt-hours in 2015 to 69.72 terawatt-hours in 2019 and are expected to reach 86.58 terawatt-hours by 2021. The concern about the increasing percentage of energy expenditure by data centers, over the years, has warned governments across the region to regulate energy consumption regularly, which is the primary factor driving the market.
• Development in IT Infrastructure in emerging countries of APAC is propelling the market. The increasing construction of hyperscale facilities with over 50 MW power capacity will feed the need for innovative infrastructure in the market over several years in APAC's developed nations.
• According to the National Association of Software and Services Companies (NASSCOM), IT exports from India may exceed USD 330 billion by 2019-20. This value for nearly 14% of India's projected worldwide use maintains its current global offshore IT market share. Besides, according to Credit Suisse, the percentage of China in the hyperscale data centers market has increased from 7% in 2017 to 10% in 2019. China's hyperscale data centers are projected to have a CAGR growth of 39.2% by 2024.
• According to DXC Technology Company, it is estimated that data centers consume about 3% of the global electricity supply and account for about 2% of total GHG emissions. The Berkeley Lab report states that data centers are on course to use 73 billion kW hours of electricity by 2020. According to the Natural Resources Defense Council, generating electricity consumed by data centers will end in the discharge of 100 million metric tons of carbon dioxide (CO2) by 2020, according to Natural Resources Defense Council.
• However, in the APAC region like Australia, data centers are a massive generator of building energy-related GHG emissions. The National Australia Bank has deployed a series of energy efficiency programs in its data centers, reducing GHG emissions.
• Companies in the APAC region are trying to tackle this issue by setting up Green data centers that use Free air cooling systems instead of traditional Air conditioners. The increasing trends toward deploying green data centers for managing, storing, and distributing information helped many software businesses decrease energy consumption and the total energy cost.
• However, adaptability demands and power outages in the Asia-Pacific region confront the market to grow. A typical data center cooling system must be pre-engineered, standardized, and modular. It is expected to be flexible and scalable to match the data center's requirements in the region. This is very challenging in today's world, with firms looking to lower costs and not spend much on high-end customized cooling systems.

Key Market TrendsInformation Technology Industry to Witness Highest Growth

• According to its size, the IT industry demands on-premise private data storage centers and hyperscale data centers for its operations. Additionally, the adoption of cloud storage in the region has grown over the years due to growth in SaaS providers, allowing cloud storage providers to develop their capacities. It is anticipated to heighten the demand for data center cooling systems in the APAC region.
• Larger tech firms like Google in the Asia Pacific region are even leveraging the potential of artificial intelligence to enhance cooling performance. Earlier, farfetched solutions like liquid server cooling systems are becoming commonplace as businesses experiment with innovative ideas to cool a new generation of high-performance processors.
• Development in IT Infrastructure in the Asia-Pacific region is propelling the market. The construction of hyperscale facilities with over 50 MW's power capacity will feed the requirement for infrastructure in the market over the next several years globally in developed nations.
• According to the State of the Edge, Asia Pacific is the region that will have the most massive edge computing footprint worldwide, accounting for 36.7% of the overall IT power footprint for edge computing infrastructure by 2028 - the equivalent to 25,409 megawatts (MW).
• According to NEC Corporation, around 30% to 40% of the power used at data centers is utilized by air-conditioning systems for cooling IT equipment. Large amounts of energy are used in hot climates and during summertime. Data centers have been established in colder climates, and other mitigating approaches were taken in terms of installation and establishment to mitigate this.
• China influences the world in internet consumption, with 710 million people online, according to a new report by CNNIC (China's Internet Network Information Center). As the requirement for cloud computing and other data services stretches to grow in China, improvements in the data center and Information technology can play an indispensable role in both the int­­­egration of these technologies with modern manufacturing and China's gradual transition to a service economy.

Emergence of Green Data Centers to Drive the Market

• With the growing need to expand, storage capacity has emerged as a significant opportunity for every one of the major enterprises in the data center and storage space market, as there has been a consistent rise in the number of data-hungry customers and applications. Globally, the amount of data will grow drastically in the next few years.
• According to Huawei, the global estimate of data center demand is expected to increase by 3 to 10 times by 2030. Green Data Center (GDC), which provides effective and eco-friendly solutions in terms of data storage and reduction in energy consumption, is expected to witness great demand, owing to the positive outlook of the data center storage needs and new constructions, which has been brought about, due to the regulations and the anticipated rise in need to reduce the operational expenditure.
• According to Green House Data Inc., the data center industry sucks down over 30 GW of energy per year, and that amount increases every day. The carbon footprint of a medium 10 MW data center can range from 3,000,000 to over 130,000,000 kilograms of CO2. Reducing that carbon footprint through efficiency and renewable energy use has a dramatic effect. Depending on the electric grid region, PUE improvements can eliminate millions of pounds of CO2 emissions, consequently boosting the market's growth.
• Despite the long-term savings and ROI, the renewable energy data centers have a high initial investment cost. A green data center solution consists of green power and cooling infrastructure solutions, coupled with energy-efficient equipment and management system, which drive the demand for green data centers over the other data centers.
• Power is an essential part of green data center investments. Both low-power solutions and effective solutions support organizations to reach their coveted objectives. However, results from contemporary researches have shown that this trend is lagging due to the effective green efficiency actions taken up in mature markets Asia-Pacific region. With the rising electricity usage, enhanced billings, and growing emissions of CO2 from these data centers, the need for green data centers is set to grow, thereby driving the data center cooling market forward in the region.
• For instance, according to IEA, the volume of global energy-related carbon dioxide emissions has steadily risen over the last decade, from 28.7 billion metric tons carbon dioxide emissions in 2009 to 33.3 billion metric tons in 2019. Even though the carbon dioxide emission went down to 31.5 billion metric tons in 2020, due to the pandemic lockdowns, it went up to 33 billion metric tons in 2021, with industries re-opening.

Competitive Landscape

The Asia Pacific Data Center Cooling Market is fragmented as the advantages offered by the technology and aid from the government by imposing efficiency regulations on data centers are expected to help the growth of the data center cooling market directly. Market penetration is growing with a strong presence of major players in established markets. With the increasing focus on innovation, the demand for new technologies is growing, which, in turn, is driving investments for further developments. Key players are Vertiv Co., Schneider Electric SE, STULZ GMBH, etc.

• June 2020 - Asetek announced a collaboration with Hewlett Packard Enterprise (HPE) to deliver its premium data center liquid cooling solutions in HPE Apollo Systems, which are high-performing and density-optimized to target high-performance computing (HPC) and Artificial Intelligence (AI) needs. The integration enables the deployment of high wattage processors in high-density configurations to support compute-intense workloads.
• April 2020 - Rittal and ZutaCore, announced innovative solutions for high-performance cooling and other scenarios that require extreme computer power under the name Rittal HPC Cooled-by-ZutaCore. The partners are backing the transformation of the data center industry with an unprecedented cooling output of 900 W and more per server. The new system works on evaporative cooling, using latent energy to evaporate refrigerant (direct contact evaporative cooling).

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

Companies Mentioned

IBM Corporation
Oracle Corporation
Internap Corporation
Packet Inc. (An Equinix Inc. Company)
Scaleway Inc.
Amazon Web Services Inc
Rackspace Inc.
CenturyLink, Inc.
LightEdge Solutions, Inc

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