DATA CENTER POWER MARKET ANALYSIS

A data center is a physical facility that organizations use to house their computer systems and its associated components. In other words, data centers are storage for the computer that has essential data important for the development of businesses or firms. Data center power is a power solution to manage power usage effectiveness and increases the efficiency of data centers. Data center manufacturers are developing power management solutions such as smart UPS, intelligent rack PDU, and battery monitoring devices to minimize power consumption rates. The major factor that boosts demand for data center power is the increasing need for data centers and enormous assistance to maintain them. Thus, replacing traditional data centers with a new one, along with advanced technologies is propelling demand for data center power.

The global Data Center Power Market is estimated to account for US$ 21298.9 Mn in terms of value by the end of 2021 and is expected to grow at a CAGR of 41126.1 during the forecasted period (2022-2030).

Market Opportunity

Increasing adoption of advanced technologies such as cloud and artificial intelligence

Datacentre manufacturers are optimizing data center costs, owing to rising operational expenses that also increase power tariffs, server racks, and heating, ventilation, and air conditioning (HVAC) systems. For instance, according to the U.S. Chamber of Technology Engagement Center (CTEC), the annual operational expenditure of large data centers is almost 8.3% of the capital expenses. Based upon data center tiers, power expenditure can range from 41%-82% of the total cost of operating data centers. The infrastructure cost and operational complexities of data centers increase the reliability level. Data center power is used for running computers & servers and cooling at data centers. Hence, in order to meet operational expenses, traditional data centers are enhanced by deploying energy-efficient and cost-effective power systems. The operational expenses of the data centers can be optimized by using a modern data center power system.

The increasing number of data centers

Vendors are offering data center power solutions to provide sustainable and reliable power systems to data centers. For instance, Huawei Technologies Co., Ltd., a China-based technology company, launched the Fusion DC 2.0 solution to optimize the cooling system of the data centers. Vendors are also offering low installation and infrastructure cost that reduces energy losses and provide a permanent storage system and do not require battery replacement. These factors are expected to drive market growth during the forecast period.

Market Restraint

High installation cost

The major factor restraining the growth of the global data center power market is a high investment. Data center companies are replacing traditional data centers with new ones, along with the latest and updated data center components. This requires new hardware, software installation, infrastructure renovation, and manpower. The initial investment in deploying energy-efficient power solutions is higher than traditional power solutions. This, in turn, is expected to hinder the growth of the data center power market.

Data Center Power Market - Impact of Coronavirus (Covid-19) Pandemic:

Owing to the Covid-19 pandemic, many industries witnessed a positive shift in their businesses. In addition to this, there was a significant impact on the data center power market as well. As per the data generated by CMI. The increasing demand for data storage leads to an increase in the number of highly reliable data centers. Globally, data centers were emerging as a computational hub for organizations, most companies have announced work from home, which increased the demand for data centers.

Furthermore, all software companies across the globe were using business intelligence tools to analyze the data to understand consumer behaviors and market trends. Due to Covid-19, demand for these tools was increased, as companies were using business intelligence tools to prepare patient reports to identify new COVID-related risks.

Competitive Scenario

Key players operating in the global data center power market include Schneider Electric, Vertiv Group Corp., ABB, Eaton, Huawei Technologies Co., Ltd., Tripp Lite, Toshiba India Pvt. Ltd., Siemens, Mitsubishi Electric Corporation, Cisco System Inc., Kehua Hengsheng Co., Ltd., Socomec, Cyber Power Systems, Inc., Bxterra Power Technology, ZincFive, Inc., Server Technology, Inc., General Electric, Hewlett Packard Enterprise Development LP, Google, LLC, Amazon.com, Inc., Facebook, Inc., IBM Corporation, and others.

Recent Developments:

• In November 2022, Amazon Web Services Inc. a subsidiary of Amazon, a provider of cloud computing platforms, announced an investment of 4.4Bn USD by 2030 in building the second-largest Data Center in Hyderabad with this investment AWS is looking forward to providing start-ups, developers, and companies to outing workloads with greater flexibility and to securely store data in India.
• On March 1, 2022 - Huawei Technologies Co. Ltd. discovered the Full Stack Data Center Resolution. Moreover, It’s constructed to help industries update their data center structure and place a solid base for digital transformation, with four key principles: renew green, renew network, and renew computing & storage, and reliability.

Forecasted Asia Pacific is expected to hold a dominant position in Data Center Power in 2030

Statistics:

Asia Pacific held a dominant position in the global data center power market in 2021, accounting for a 38.3% share in terms of value, followed by North America and Europe.

Figure 1: Global Data Center Power Market Share (%), By Region, 2021

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Asia Pacific Data Center Power Market is expected to witness a high CAGR over the forecast period.

Asia Pacific is expected to be one of the prominent regions in the global market and witness high growth during the forecast period. This is owing to the rising adoption of cloud computing and IoT 

Figure 2: Global Data Center Power Market (US$ Mn) Analysis and Forecast, 2017 – 2030     

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The Global Data Center Power Market was valued at US$ 21298.9 Mn in 2021 and is expected to reach US$ 41126.1 Mn by 2030, growing at a CAGR of 7.8% between 2022 and 2030.