Data Center Power Market Size By Component, By Application, By Data Center, Growth Forecast 2025 – 2034

Data Center Power Market Size

The global data center power market was valued at USD 14.1 billion in 2024 and is estimated to register a CAGR of 7.5% between 2025 and 2034.  There has been an increase in the use of modular data centers which in turn has increased the market for data center power. Modular data centers possess elevated levels of efficiency, scalability, flexibility, and are becoming increasingly popular as a solution to the high demand for data processing and storage.
 

The modular power equipment combines generators, power distribution units, and uninterruptible power supplies. These prefabricated homes can be constructed at low cost and energy can be saved as well leading to lower operational expenses and a decreased carbon footprint. With the expansion of the digital infrastructure, there is a growing demand for robust and efficient power alternatives for modular data centers.
 

For instance, in July 2024, Vertiv introduced the MegaMod CoolChip which is labelled as a high-density modular data center which is prefabricated and aims to simplify AI computing. This advanced proposition intends to deploy fundamental digital infrastructure for AI up to 50% faster than the standard onsite construction methods. For AI workloads, prominent cooling technologies are used for AI applications including powerful central processing unit and graphics processing unit cooling with a MegaMod CoolChip which utilizes novel direct-to-chip liquid cooling methods. This technology increases the efficiency and the reliability of AI applications.
 

Starting from 2023, major internet companies such as Microsoft, Google, and IBM have started to build next-generation modular data centers. Alibaba, Baidu, and Tencent, as well as their partner companies, have also adopted these technologies into their newly built data centers. They have gained advantages regarding costs, energy consumption, and construction duration. In terms of civil engineering costs, the modular data center is superior to its conventional counterparts. It is built using prefabrication, and the expenses of design, management, and turnkey contracting are 30% less than those of a traditional data center.
 

Data Center Power Market Trends

• The use of AI automation within data centers is referred to as artificial intelligence within a data center. This further divides into several subcomponents, including predictive maintenance, heat and cooling management, and advanced algorithms that optimize server performance.
   
• The function of AI within data centers is much more than simply automating tasks; it provides a more integrated and self-aware approach to strategy execution, thus improving the efficiency and reliability of the data centers alongside meeting the growing standards associated with the complexity and volume of the data processing tasks.
   
• The productivity and operational costs of a data center that incorporates AI technologies increases due to better energy management. Modern automation system empowered with data collection and analysis techniques of machine learning examine information related to energy use, cooling system functions, workload distribution, and many other pertinent historical and active processes.
   
• With the use of AI, it is possible to identify patterns, trends, and outliers over a prolonged period which helps allocate resources such as energy, cooling, and workload in a manner that maximizes outcome while minimizing expenditure within the cooling, power, and workload divisions. Moreover, supervisors were able to fix issues before they ballooned into bigger problems, which improved maintenance practices courtesy of AI.
   
• The system becomes more reliable and experiences less downtime. Eventually, self-regulating energy management systems will be created and improved upon over time through operational data from the data center and feedback loops which over time aligns the center's resource expenditure with AI-driven optimization techniques.
   
• For instance, Schneider Electric and NVIDIA partnered in February 2024 for the purpose of improving data center infrastructure focused on artificial intelligence innovations. This partnership leverages Schneider Electric’s energy management and automation expertise along with NVIDIA’s AI prowess to develop the first publicly available AI data center reference designs. These designs also help in the reduction of energy usage in data centers.
   

Data Center Power Market Analysis

Based on application, the market is divided into BFSI, colocation, energy, government, healthcare, manufacturing, IT & Telecom, and others. In 2024, IT and Telecom held 24% of the market share and is expected that colocation market will generate revenue of over USD 11 billion by 2034.
 

• Both the telecommunication and IT sectors are now deploying power systems for data centers. The shift to low latency data processing is driving the increased need for computing power in edge AI, alongside the growth of 5G networks and cloud offerings.
   
• The latest power control systems for cooling IT and Telecom Data Center enhances systems performance, offers savings, and reduces the emission of greenhouse gases.
   
• According to AIRSYS from North America, he alleges that the recently built data and telemetry centers are primarily focused on having sophisticated cooling systems installed by April 2024. Due to the high performing computers performance there is an additional need for energy efficiency and cost effective operation. This shifts the focus towards massive spending on high density computing due to an increased need for cooling to dissipate auxiliary energy.
   
• At the same time, there has been greater reliance on new cooling configurations as well as the use of renewable energy sources to address sustainability issues with reliable capacity to support fundamental operations.
   

Based on component, the data center power market is categorized into solution and services. The solution segment held a market share of 63% in 2024 and services segment is expected to grow at CAGR of around 8% during the forecast period.
 

• The solution segment is observing the shift towards incorporating renewable resources, wind and solar energy into the power solutions of the data center. This transformation is occurring due to economic reasons as well as environmental issues together with the lower cost of renewables compared to traditional electricity sources.
   
• There is a rapid rise in adoption of sophisticated features in power distribution unit (PDU). For instance, Panduit, a company of power networks and solutions, introduced the ES2P PDU in February 2024. The PDU has advanced monitoring and management capabilities as well as power distribution reliability. The goal is to manage better power distribution and its reliability in a data center which is critical to the industry’s efficiency and performance.
   
• The UPS segment is a leader in solutions related to power supply to data centers. In December 2023, Eaton released a new compact model of UPS: the 93T. The 93T, an uninterruptible power supply (UPS), is a compact power supply of 15 kVA to 80 kVA for commercial, industrial, financial, healthcare and government, along with IT services. As a result of its merits as one of the best powered solutions, it is well suited for servers and small data centers.
   

Based on data center, the data center power market is divided into hyperscale, colocation, edge, and enterprise. The colocation segment dominated the market accounting for USD 5.7 billion in 2024.
 

• Due to the increasing energy costs and government budget cuts, energy efficiency measures are now becoming a necessity for colocation providers. Data centers use various renewable energy resources including solar, wind and hydropower. Some vendors are going as far as to advertise green data centers that are powered by some renewable energy to appeal to eco-friendly buyers.
   
• For instance, AirTrunk has furthered their progress in reaching net-zero emissions by 2030 with the solar panel installation of a 1-megawatt system on the roof of its data center located in Johor Bahru Malaysia, which is set to be completed in December 2023. It also marks the company’s first renewable energy initiative in that region.
   
• Due to the growing power demand for high density IT infrastructure, most data centers are using powerful cooling methods. Over time, cooling systems, like other system components, have become more energy efficient. Colocation providers are adopting liquid cooling, AI cooling, and other forms of free-air cooling to optimize energy efficiency. These types of cooling reduce the use of air conditioning units, resulting in lower energy costs while the cooling management of modern servers and equipment is improved.
   

In 2024, the U.S. dominate the North American data center power sector with revenue around USD 3.6 billion.
 

• The power market for data centers in the US will grow substantially in the forecast period due to major technology stakeholders such as HPE and IBM. These technology providers are building their data centers which include servers, racks, and other IT equipment, which increases the burden on power equipment to become more efficient, enabling these facilities to operate without interruptions.
   
• In April 2024, Equinix and PGIM Real Estate created joint venture for the construction and operation of xScale data centers in Silicon Valley, US, with an estimated investment of USD 600 million.
   
• In November 2024, HPE had a public demonstration of its new technology, which is liquid cooling AI servers. This innovation solves the problem of energy hungry AI server racks by making the data centers more energy efficient.
   
• The proliferation of small and large enterprises adopting cloud computing services is one of the driving factors for the expansion of data centers in Canada. The Digital Research Alliance of Canada (the Alliance) claims that cloud-based services are being adopted in the context of higher education research all over the world and that Canada needs to devise a cloud computing strategy to meet the evolving demands of the researchers.
   

Predictions suggest that from 2025-2034, the Germany data center power market will grow tremendously.
 

• Because of the industrial strength in Germany, there is an increasing need for power solutions for data centers that support manufacturing, automotive, and engineering processes. Also, the sustainability policies in Germany incentivize data center operators to improve their carbon emissions by using efficient energy power solutions and renewable energy sources which aids in meeting compliance requirements.
   
• Mercury Engineering has plans to build a new data center located in Schonebeck, Germany, with the completion date set for December 2024. The first phase of the investment has been set and secured at 25 million Euro; further expansion will cost as much as 45 million. This investment will strengthen Germany’s already EU’s leading industrial economy and its need for data center infrastructure.
   

The Chinese data center power market will experience prosperous growth during the prediction period from 2025 through 2034.
 

• The increasing demand for cloud computing will lead to growth in the number of cloud service providers which, subsequently, will accelerate growth in the China data center power industry. From the perspective of expanding businesses, the rising requirement for streamlined connectivity and flexible solutions will significantly promote the growth of the data center power industry.
   
• According to the China Academy of Information and Communications Technology, China’s cloud computing market value reached USD 63.4 billion in 2022 exhibiting a growth rate of 40.91%. And this far exceeded the global growth rate of 19%.
   
• The development of the telecommunications network, including mobile subscriptions, leads to an increase in data traffic. This increase in data traffic drives the development of the data center industry which, in turn, stimulates growth in the market. Additionally, the efforts to reduce China’s carbon emissions and move towards solar, wind and other renewable energy sources makes it easier for data center operators to invest in solutions that will ease the negative impacts on the environment.
   

Data Center Power Market Share

• Top 7 companies in the data center power industry are Schneider Electric, Vertiv, Eaton, ABB, Delta Electronics, Huawei Technologies, and Caterpillar, which have around 40% of the market value in 2024.
   
• The strategy of Schneider Electric in the market is multi-pronged as it provides comprehensive solutions and services for a broad spectrum of data center requirements. It not only encompasses construction of new data centers, but also the modernization of older facilities with various structures such as on-premises, hybrid, centralized, regional, and local edge data centers.
   
• Schneider Electric offers services and products vital in the functioning of a data center which covers IT hardware, storage devices, firewall, router, cooling systems, generators, batteries, cables, etc. The introduction of Live Swap in the Galaxy VL solution allows for the seamless delivery of power during maintenance or upgrades, enhancing business continuity and reducing downtime.
   
• Vertiv Inc. has a competitive edge in the data center power market because of its broad range of Liebert Uninterruptible Power Supplies (UPS) and integrated with foreseen requirements UPS systems designed for enterprise and hyperscale data centers. Their offer goes beyond the provision of reliable backup power to include power distribution units and rack PDUs for support to different challenges within the IT infrastructure.
   
• By drawing from its significant expertise in high-density power and cooling infrastructure, Vertiv focuses on providing comprehensive solutions for clients with power distribution and focuses on remote monitoring and management solutions.
   
• Eaton Corporation provides solutions that aim to enhance the processes of decision making and energy conservation- a focus that distinguishes them from competitors in the data center power industry. Eaton improves the integration of renewable energy systems by providing the Energy Aware UPS backup power system and the energy management Brightlayer Data Center Software Suite.
   
• With intelligent power management, data can be analyzed and transformed into beneficial information instantaneously. Through the provision of insight and digital solutions, Eaton set out its transformative vision on solving industry challenges through collaboration and innovation using the Brightlayer platform.
   

Data Center Power Market Companies

Major players operating in the data center power industry include:

• ABB
• Active POWER
• Belkin International
• Black Box
• Caterpillar
• Delta Electronics
• Eaton
• Huawei Technologies
• Schneider Electric
• Vertiv
   

The leading players in power data centers are forming partnerships, joint ventures, mergers, acquisitions, and investing in new products and services as well as in R&D activities. These shifts enable the companies to integrate advanced power management systems and technologies which correspond with the changing requirements of the data centers. Strategic relationships with the important players of the market allow manufacturers to enjoy wider markets, better sources of materials, as well as new products. To keep ahead of competition, principal companies undertake large amounts of R&D expenditures that allow them to respond to technological changes and stimulate growth in the industry.
 

In their advanced product portfolio, companies are offering new smart and more affordable solutions. These solutions are meant for the range of data centers which include large facilities and modern server farms. A wide range of products gives not only the opportunity to enter new markets but also enables the company to respond to the fast-changing legal and environmental conditions of the data center.
 

Data Center Power Industry News

• In July 2024, Vertiv and ZincFive partnered to improve energy storage capabilities for data centers in North America and EMEA markets. This collaboration is aimed at adding ZincFive's BC Series UPS Battery Cabinets into Vertiv's products.
   
• In March 2024, Alphabet partnered with SIP Sidewalk Infrastructure Partners, to develop battery powered microgrids for data centers. The microgrid has high-capacity batteries coupled with a power management system. The system comprises large capacity batteries which are coupled with energy management software. These fuels microgrids are versatile enough to be placed anywhere power is needed the most.
   
• In November 2024, Delta announced the launch of a new compact and intelligent power management unit, intended for telecom operators and data centers, the SMART PDU I-Type. The unit is a 1U DC distribution unit that is designed to increase power management efficiency while maximizing rack space.
   
• In November 2024, Flex incorporated JetCool Technologies as a subsidiary, marking the company's entry into liquid cooling solutions for data centers. This acquisition is part of Flex’s strategy to expand into the data center and power segments in response to increasing AI workload and high-performance computing power and thermal demands.
   

The data center power market research report includes in-depth coverage of the industry with estimates & forecast in terms of revenue ($Bn) from 2021 to 2034, for the following segments:

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Market, By Component

• Solution
  • Power distribution units (PDUs)
  • UPS
  • Generators
    • Diesel generator
    • Gas generator
  • Cabling infrastructure
  • Others
• Services
  • Managed
  • Professional

Market, By Application

• BFSI
• Colocation
• Energy
• Government
• Healthcare
• Manufacturing
• IT & telecom
• Others

Market, By Data Center

• Hyperscale
• Colocation
• Edge
• Enterprise

The above information is provided for the following regions and countries:

• North America
  • U.S.
  • Canada
  • Mexico
• Europe
  • UK
  • Germany
  • France
  • Spain
  • Poland
  • Benelux
• Asia Pacific
  • China
  • India
  • Japan
  • Singapore
  • Australia 
• South America
  • Brazil
  • Chile
  • Peru
  • Argentina 
• MEA
  • UAE
  • Saudi Arabia
  • South Africa