Data Center Cooling Market Dynamics, Recent Developments, and Strategic Insights by 2031

The data center cooling market size is expected to reach US$ 45.70 billion by 2031 from US$ 13.29 billion in 2023. The market is estimated to record a CAGR of 16.7% during 2023–2031. AI-optimized cooling and quieter cooling solutions are likely to bring new trends to the market.

Data Center Cooling Market Analysis

Increased demand for compute-intensive workloads and high investments in data centers drive the data center cooling market. The market is also witnessing a greater use of high-performance computing (HPC), which is contributing to the demand for data center cooling solutions. Moreover, the rising strategic initiatives taken by major companies, such as the collaboration between Intel Corporation and Submer to develop a solution for cooling chips with high Thermal Design Power (TDP), contribute to the growth of the market. Furthermore, the escalating need for energy-efficient and robust data center cooling solutions, coupled with the increasing penetration of the Internet; cloud computing; and technologies such as AI, IoT, and big data, are projected to fuel the adoption of data center liquid cooling. The market is expected to grow in the forecasted period owing to advancements in liquid cooling technologies and a rise in data center cooling robots.

Data Center Cooling Market Overview

Data center cooling refers to the systems and technologies used to maintain an optimal temperature within the data center to ensure the proper functioning of the IT equipment. IT equipment produces heat during operation, and extreme heat can lead to equipment malfunction and failure. To overcome such challenges, the demand for data center cooling has rapidly increased. Cooling systems are essential for maintaining the reliability and performance of the data center infrastructure. Data center cooling plays a vital role in creating and sustaining the optimal operational conditions for all the equipment housed within a data center. Data centers collectively consume approximately 3% of the world's electricity; as a result, a substantial amount of heat is generated. Without the implementation of an efficient cooling system, the risk of IT equipment malfunction, costly damages, and operational downtime significantly increases.

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Data Center Cooling Market: Strategic Insights

Data Center Cooling Market

• 
  CAGR (2023 - 2031)

  16.7%
• Market Size 2023
  US$ 13.29 Billion
• Market Size 2031
  US$ 45.70 Billion

Market Dynamics

GROWTH DRIVERS

• Increased Demand for Compute-Intensive Workloads
• Increasing Investments in Data Centers

FUTURE TRENDS

• AI-Optimized Cooling and Quieter Cooling Solutions

OPPORTUNITIES

• Advancements in Liquid Cooling Technologies
• Data Center Cooling Robots

Key Players

• Asetek, Inc
• Fujitsu Ltd
• Mitsubishi Corp
• Rittal GmbH & Co KG
• Schneider Electric SE
• Stulz SpA
• Trane Technologies Plc
• Vertiv Group Corp.
• Black Box Corporation
• Carrier Global Corp

Regional Overview

• North America
• Europe
• Asia-Pacific
• South and Central America
• Middle East and Africa

Market Segmentation

Component

• Air Conditioning System
• Chillers
• Air Handling Units
• Cooling Towers
• Heat Exchangers
• Humidifiers

Cooling Type

• Room Based Cooling
• Row Based Cooling
• Rack Based Cooling

Data Center Type

• Hyperscale Data Center
• Colocation Data Center
• Wholesale Data Center
• Enterprise Data Center

Industry Vertical

• IT and Telecom
• BFSI
• Healthcare
• Manufacturing
• Government and Defense
• Media and Entertainment
• Retail
• Energy

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Data Center Cooling Market Drivers and Opportunities

Increasing Demand for Compute-Intensive Workloads To Favor Market Growth

Various industries are incorporating AI and machine learning to enhance customer experience, bolster cybersecurity measures, and revolutionize their business processes. The deployment of these technologies and the optimization of their value necessitate robust infrastructure capable of handling increasingly complex workloads. The compute-intensive nature of AI model training has driven the evolution of hardware to meet the escalating demands of AI and other advanced applications. For instance, in April 2024, Lenovo announced a comprehensive new suite of purpose-built AI-centric infrastructure systems and solutions to advance Hybrid AI Innovation from edge to cloud. Lenovo is delivering GPU-rich and thermally efficient solutions intended for compute-intensive workloads across multiple environments and industries. In the financial services and healthcare industries, customers are managing massive data sets that require extreme I/O bandwidth, and Lenovo is providing the IT infrastructure solutions vital to the management of critical data.

As enterprises continue to harness the potential of AI and machine learning, the ongoing evolution of computing hardware plays a pivotal role in enabling the efficient processing and utilization of vast amounts of data, thereby empowering organizations to make informed decisions and analyze data assets. The heightened computing capacity and demands for hardware have resulted in increased power consumption and heat generation. As a result, rising data center temperatures, attributed to the use of higher-density hardware, have highlighted the significance of liquid cooling as a crucial technology for mitigating these thermal challenges. Thus, the increasing demand for compute-intensive workloads drives the data center cooling market.

Advancements in Liquid Cooling Technologies

Liquid cooling has emerged as an optimal solution to meet the requirements of the high-performance computing (HPC) and data center industries. By negating the necessity for continuous air circulation, liquid cooling markedly diminishes utility consumption, thereby enhancing the energy efficiency of the facility. Liquid cooling technologies have emerged as a popular solution, with ~40% of data centers utilizing it. Companies are forming strategic partnerships to participate in the advancements of liquid cooling technologies. For instance, Mitsubishi Heavy Industries, Ltd. (MHI) and ZutaCore, Inc. formed a strategic partnership in September 2023 to advance sustainable liquid cooling solutions for the data industry to achieve energy efficiency and zero emissions. This collaboration involves MHI's investment in ZutaCore and a white-label sales agreement, combining ZutaCore's HyperCool dielectric direct-liquid-cooling technology with MHI's extensive product line and technological expertise at a global scale. ZutaCore's HyperCool technology is a waterless, direct-on-chip liquid cooling solution that aims to bridge the gap between data industry sustainability and ever-increasing computing power. It delivers 10x more computing, a 50% total cost of ownership (TCO) reduction, and 100% heat reuse, as well as reduces CO2 emissions. This technology is designed to move large amounts of heat off the chip effectively and safely, with no practical limit to heat dissipation. It also aims to reduce the consumption of scarce resources, including energy, water, and land, while reducing capital and operating expenses. This partnership aims to expedite the growth of sustainable liquid cooling solutions crucial for energy efficiency. The comprehensive solution provided by this collaboration offers unprecedented benefits to high-performance computing workloads, server densification, and data center sustainability.

Data Center Cooling Market Report Segmentation Analysis

Key segments that contributed to the derivation of the data center cooling market analysis are component, cooling type, data center type, and industry vertical.

• In terms of component, the market is segmented into chillers, air conditioning systems, heat exchangers, cooling towers, air handling units, humidifiers, and others. The air conditioning systems segment dominated the market in 2023.
• By cooling type, the market is categorized into room-based cooling, rack-based cooling, and row-based cooling. The room-based cooling segment dominated the market in 2023.
• Based on data center type, the data center cooling market is segmented into enterprise data center, colocation data center, wholesale data center, and hyperscale data center. The hyperscale data center segment dominated the market in 2023.
• In terms of industry vertical, the market is categorized into BFSI, manufacturing, IT & telecom, media & entertainment, retail, government & defense, healthcare, energy, and others. The IT & telecom segment dominated the market in 2023.

Data Center Cooling Market Share Analysis by Geography

The data center cooling market is segmented into five major regions: North America, Europe, Asia Pacific (APAC), the Middle East & Africa (MEA), and South & Central America. North America dominated the market in 2023, followed by Europe and APAC.

The North America data center cooling market is growing significantly owing to the rise in the data center industry and the growing adoption of cost-effective and environmentally friendly data center cooling solutions. The market players are introducing innovative and advanced solutions to cater to the demand for technologically advanced computing solutions, further fueling the market growth. For example, in November 2023, Vertiv introduced the Vertiv SmartMod Max CW, a prefabricated modular data center built to address the increasing demand for rapid deployment of computing in North America.

Data Center Cooling Market Report Scope

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Data Center Cooling Market News and Recent Developments

The data center cooling market is evaluated by gathering qualitative and quantitative data post primary and secondary research, which includes important corporate publications, association data, and databases. A few of the developments in the data center cooling market are listed below:

• Mitsubishi Heavy Industries, Ltd. (MHI) developed a new 40kVA-class 12ft container-type data center with an immersion/air-cooled hybrid cooling system capable of simultaneously housing servers utilizing three types of cooling methods: immersion cooling (25kVA), air cooling (8kVA), and water cooling (8kVA). The newly developed data center was the successor to the container-type immersion cooling data center that has been under development since 2021. Servers with different cooling methods for a variety of applications (by power density) can be mounted in the unit simultaneously, accommodating a diverse range of servers and other devices for edge computing to process data at the periphery (edge) of computer networks.

(Source: Mitsubishi Heavy Industries, Ltd, Press Release, October 2023)

• STULZ, the global mission-critical air conditioning specialist, announced the launch of CyberCool CMU—an innovative new coolant management and distribution unit (CDU) that is designed to maximize heat exchange efficiency in liquid cooling solutions.

(Source: STULZ, Press Release, March 2024)

Data Center Cooling Market Report Coverage and Deliverables

The "Data Center Cooling Market Size and Forecast (2021–2031)" provides a detailed analysis of the market covering the areas mentioned below:

• Data center cooling market size and forecast at global, regional, and country levels for all the key market segments covered under the scope
• Data center cooling market trends as well as market dynamics such as drivers, restraints, and key opportunities
• Detailed PEST and SWOT analysis
• Data center cooling market analysis covering key market trends, global and regional framework, major players, regulations, and recent market developments
• Industry landscape and competition analysis covering market concentration, heat map analysis, prominent players, and recent developments for the data center cooling market
• Detailed company profiles