Hong Kong Data Center Power - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2024 - 2029)

Hong Kong Data Center Power - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2024 - 2029)

The Hong Kong Data Center Power Market size is estimated at USD 311.70 million in 2024, and is expected to reach USD 446.90 million by 2029, growing at a CAGR of 7.20% during the forecast period (2024-2029).

The increasing demand for 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 in the country.

Key Highlights

• Under Construction IT Load Capacity: The upcoming IT load capacity of the data center market in Hong Kong is expected to reach 1700 MW by 2029.
• Under Construction Raised Floor Space: The country’s construction of raised floor area is expected to increase to 6 million sq. ft by 2029.
• Planned Racks: The country’s total number of racks to be installed is expected to reach 230K units by 2029. NCR Ho Chi Minh City is expected to house the maximum number of racks by 2029.
• Planned Submarine Cables: There are about two submarine cable systems connecting Hong Kong, and a few more cables are expected in the near future. One such submarine cable that is estimated to start service in 2025 is Asia Cable Link ALC, which stretches over 6,000 kilometers with landing points from Hong Kong SAR, Mainland China.
• With its domestic production of energy, Hong Kong has the potential to be partially self-sufficient. Overall, 33 billion kWh of electricity is generated in all the power-generating facilities. It is about 75% of the country’s requirement. The rest of the needed energy is imported from other countries. The production, import, and export sectors contribute significantly in addition to consumer consumption.
• In view of its commitment to reach a carbon dioxide peak by 2030 and be carbon neutral by 2060, Hong Kong is placing energy consumption control at the top of its priorities. Its ongoing “dual control” energy consumption policy is a regulatory effort aiming to control high energy consumption and limit high-emission projects.
• In support of the above policy and to reduce energy consumption, key market players are focusing on introducing efficient power management systems such as PDUs, busways, and UPS for the purpose of controlling unnecessary expenditures in data centers, which is expected to drive the market’s growth. For instance, one of the significant distributors, Kohler Power in Hong Kong, supported one of the region’s largest carriers and cloud-neutral data center operators in expanding 70,000 square meter facility by switching from an aging rotary uninterruptible electricity supply to diesel generators as a means of reducing long-term maintenance costs.

Hong Kong Data Center Power Market Trends

IT & Telecommunication Segment to Hold Major Share in the Market

• The demand for the cloud segment is expected to increase with the growing demand for analytics, visualization tools, and business services. The increasing adoption of cloud-based services is also driving the expansion of hyperscale and wholesale colocation services in Hong Kong, resulting in increased demand for space in data centers and, consequently, the need for more racks within data centers.
• With 5G being introduced in the country, high bandwidth speeds offered led to users opting for multiple smart devices, such as smart wearables, tablets, security systems, smart lighting, etc., which catalyzed the demand for these devices. Around 96% of the population in Hong Kong currently uses smartphones to access the internet on a daily basis.
• To meet the surplus demand, automation has to be introduced in the industry as per Industry 4.0 measures. Increasing demand for streaming services, financial services, and smart home automation applications is expected to further catalyze data consumption.
• The increasing number of users of smart devices, such as smartphones and tablets, for varying needs such as streaming, browsing, and playing games has led to consumers opting for 4G services, thus diminishing the 3G service market over the years. The implementation of 5G is expected to further increase the data speed with the evolving technology over the years, which is expected to cater to the demand as more industries adopt automation in their companies in the manufacturing sector. Such improvements in the market are expected to create more demand for data center servers in the coming years.
• The Minister of Posts and Telecommunications is planning to connect 2,715 kilometers of submarine fiber optic cable network from Hong Kong to Preah Sihanouk. The project was initiated in 2022, with a completion target in 2024. Such developments are expected to increase the adoption of data storage solutions and positively impact the market’s growth.

Monitored PDUs Expected to Hold Significant Share in the Market

• The increasing focus on digitalization, internet penetration (reached 93.1% by the start of 2023 from 93% during the same period in 2022), strong connectivity, and e-commerce sales across the country creates more need for storage facilities, resulting in huge demand for data centers and a rise in power consumption. Growing demand for data storage has led to the deployment of intelligent power distribution units (PDUs) against simple multi-socket rack installations with server and network equipment, which optimize power consumption in data centers.
• Monitored rack PDUs are essential components in data center and server room infrastructure, providing real-time monitoring of power usage, voltage, current, and other electrical parameters. This data helps administrators make informed decisions about power allocation and capacity planning.
• By tracking power usage trends, administrators can plan for future growth and ensure that power capacity is not exceeded, preventing overloads that could lead to equipment failures. It also helps identify inefficiencies and optimize energy usage. This can lead to cost savings and a reduced environmental footprint by eliminating unnecessary power consumption. In addition, it allows administrators for remote access and control, reducing the need for physical presence and minimizing operational disruptions.
• In the policy addressed in 2021 (The Chief Executive’s 2021 Policy), the Hong Kong government announced the allocation of around USD 30 billion to implement measures on net-zero electricity generation, green transport, and waste reduction for the next 15 to 20 years. This includes the development of distributed power generation, energy efficiency activities, and building conservation.
• Because of the above advancements mentioned with monitored PDUs and the necessity to reduce electricity consumption as per government measures in the country, key players are focusing on introducing energy-efficient products into the market. For instance, in May 2023, Eaton, which provides power management services, launched G3 Universal Input Rack PDUs with dynamic C39 outlets capable of accommodating different plug configurations and input voltage requirements. To meet the most diverse data center rack power requirements, G3UPDU has added new features.
• In May 2023, Legrand, a significant global provider of electrical and digital building infrastructures, introduced the next generation of intelligent rack PDUs PRO4X and Raritan PX4; these new intelligent rack PDU designs revolutionize capacity planning, environmental monitoring, physical and digital access control, workload optimization, and uptime initiatives. Such developments in the segment are predicted to boost regional demand over the forecast period.

Hong Kong Data Center Power Industry Overview

The upcoming DC construction projects in Hong Kong are anticipated to increase the demand for the data center power market in the coming years. The data center power market in the country is moderately consolidated with some players in the market, including Cummins Inc., Eaton Corporation, Legrand Group, Vertiv Group Corp., and Schneider Electric SE. These major players, with a prominent market share, focus on expanding their regional customer base.

• January 2024: Vertiv announced plans to double its manufacturing capacity for busway, switchgear, and integrated modular solutions (IMS) by 2025. The expansion plans include increasing utilization and footprint in the United Arab Emirates, Ireland, South Carolina (United States), Mexico, Slovakia, and Northern Ireland.
• December 2023: Eaton announced the launch of its new Rack PDU G4 (4th generation) that provides high security and business continuity data center. It also combines with C39 outlets that securely connect both C14 and C20 power cords, backed by a locking mechanism and a built-in high retention system that secures the power cord.

Additional Benefits:

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