Europe Data Center Cooling Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

Europe Data Center Cooling Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The European Data Center Cooling market is expected to register a CAGR of 9.8% during the forecast period (2021 - 2026). The growing cloud computing due to COVID-19, increasing cloud computing among SMEs, government regulations for local data security, and growing investment by domestic players are some of the major factors driving the demand for data centers and cooling markets in the region.

Key Highlights

• Cooling technologies are usually selected based on the geographical location of the data center. As companies regularly seek to mitigate costs, energy-efficient cooling methods are being considered the potential alternatives to traditional cooling methods. It is estimated that the power used in cooling accounts for around 39% of the total power used to maintain data centers.
• At the behest of government and regulatory agencies' assistance, the European market has been a pioneer in implementing eco-friendly data cooling techniques. Scandinavian countries (Norway and Sweden) and Russia have emerged as viable alternatives to Grade-A zones (United Kingdom, Germany, and France) for data center setup and management. These regions have favorable temperatures that can be utilized for cooling data center zones. Thus, the data center cooling market in Europe is expected to experience significant growth over the forecast period.
• Mobile data usage in the above European countries is expected to observe a high growth. This is anticipated to boost the setup of data centers across the European region, thereby propelling the market growth over the forecast period.
• United Kingdom, Germany, and France recorded the highest number of data centers across Europe. Industry players can target these countries to invest in their new technologies. Also, they can form partnerships with upcoming data center organizations to cater to their requirements at a competitive price, which may aid the growth of the European data center cooling market over the forecast period.
• Further, technological advancements have made liquid cooling simple to maintain, easily scalable, and affordable. The energy dedicated to liquid cooling can be recycled to heat buildings or water, effectively shrinking the carbon footprint of air conditioning.

Europe Data Center Cooling Market TrendsRetail Industry is Expected to Hold Significant Market Share

• In the retail industry, the increasing number of users in e-commerce and online spending is creating an enormous volume of Big Data, which is expected to propel the need for data storage, security, and reduced latency, thereby boosting the expenditure and number of data centers in the region.
• Due to the increasing number of online users, foreign retail companies are regularly investing in European countries. For instance, JD.com, a Chinese e-commerce giant, recently confirmed a strategic entry into the European retail sphere.
• Additionally, according to the GDPR (General Data Protection Regulation), the foreign companies collecting any sensitive data have to comply with European regulations regarding security and handling of personal information. Due to stringent regulations in the region, retail companies, including JD.com, investing in the region may store their data locally for smooth transitions regarding the data protection law. As a result, the usage of data center cooling systems is expected to increase, thereby boosting the market growth in the region over the forecast period.
• Notably, according to the E-commerce Foundation, the European B2C e-commerce turnover is expected to expand by approximately 13% to reach EUR 621 billion due to the high internet penetration in the region. This may increase the volume of Big Data, leading to more data centers and cooling systems being set up in the region.
• Further, according to Eurostat, Italy and Poland witnessed tremendous growth in the number of e-commerce users. This has led to the generation of a vast amount of data, thereby strengthening storage requirements. As a result, it is expected to expand the European data center cooling market over the forecast period.

United Kingdom Accounts for the Largest Market Share

• The companies in United Kingdom are rigorously investing in setting up new data centers. This is expected to positively impact the market growth in the region over the forecast period. For instance, Interxion, a colocation and networking company in Europe, commenced their third data center in London, expanding carriers and CDNs for consumers. This development is expected to propel the utilization of the cooling system, thereby fostering the market growth.
• Moreover, H&M, a fashion retailer in the country, plans to integrate a cooling and heat recovery system in its new data center in Stockholm. The excess heat generated from the data center is reused by Fortum Värme, an energy company, by distributing it to customers (2,500 modern residential apartments at full load) throughout the city.
• United Kingdom recorded the highest number of data centers across Europe. Industry players can target these countries to invest in their new technologies. Also, they can form partnerships with upcoming data center organizations to cater to their requirements at a competitive price, which may aid the growth of the European data center cooling market over the forecast period.
• Notably, growth in Big Data volume across European countries, including United Kingdom, is expected to increase the need for low latency and high capacity data centers, thereby boosting the utilization of the cooling system.
• Further, companies are regularly trying to reduce their operational cost across their verticals, increasing the use of AI technologies in data center cooling systems in the country. For instance, Siemens introduced AI-based thermal optimization wherein the company utilizes Vigilent AI products to enhance cooling systems in data centers.

Europe Data Center Cooling Market Competitive Analysis

The European data center cooling market is fragmented as the benefits offered by the technology and support 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. Some of the recent developments in the market are:

• June 2021 - Schneider Electric has launched a pre-fabricated Edge data center, with Iceotope's Ku:l 2 liquid cooling built-in. The single-rack EcoStruxure modular data center comes in a 20ft ISO shipping container and supports up to 60kW as standard. This can be expanded to 336kW as a customized option. Schneider promises it will have a PUE (power usage effectiveness) of less than 1.15 - and says it could go as low as 1.03.
• 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.

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