Report Finds Data Center Power Market will Grow Significantly Through 2027

Data Center Power Market

(Credit: Pixabay)

by | Feb 23, 2022

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Data Center Power Market

(Credit: Pixabay)

The large, cloud-based data centers that are needed to provide energy for expanding technologies such as smart cities are boosting the global data center power market.

The market is expected to grow at a CAGR of more than 6.5% from 2022 through 2027, according to a Research and Markets report. The rising adoption of mega data centers which use significant energy is at the center of such an increase.

The report says according to Cisco, data center traffic was expected to reach 19.5 zettabytes per year by 2021. That is being driving by smart platforms and the growth of Internet of Things (IoT) applications.

Additionally, data center  colocation providers are looking for improved and modern infrastructure that requires less maintenance and space and complete reliability, the report says. Markets and Research says those areas are expected to encourage vendors to offer innovative power solutions.

According to the Department of Energy, data centers use up to 2% of the total electricity use in the United States. They also take up a lot of space, consuming up to 50 times the energy per floor space of the average commercial office space.

Another report by Research and Markets shows efficient data centers were expected to be valued at nearly $181 billion by 2026.

Power distribution units are the most established products in the data center power market and are expected to register more moderate growth during the forecast period. Markets and Research says high investment needs are restraining the market growth some, as infrastructure management, power and cabling require high initial funding.

With an increase in on-site private data storage centers and the adoption of software as service providers, data loads require more power, which increases the need of more efficient power platforms, according to the report. Nearly 98% of respondents in a recent Vertiv survey say IT utilization needs to be above 20% by 2025, which Markets and Research says means IT companies are focusing on efficient power sources for data centers.

The report also points out that cloud storage providers like Amazon Web Services, Microsoft and Google are expanding their storage offerings and making large investments. Facebook parent company Meta plans a data center in Idaho that uses 100% renewable energy.

In Illinois, utility ComEd has invested $2 billion and developed six new data centers, including a 30 megawatt facility to support the area’s commercial data center needs.

In addition to smart technologies and cloud services, emerging industries can see a huge demand on energy and data center service. Cryptocurrency mining, for example, uses huge amounts of energy, which creates demand for new ways to produce energy for operations.

The Asia-Pacific region will experience high data center power market growth, according to the report. China data centers, for example, used 161 billion kilowatt-hours of electricity in 2018 and data center power consumption is expected to grow 66% by 2023.

In Japan, there is a movement by the government to subsidize half of building costs toward zero carbon emissions data centers and upgrade existing facilities as part of a $7.3 billion initiative to innovate the industry and reduce emissions.

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