The global data center liquid cooling market was valued at USD 2.48 billion in 2023. The global market is expected at USD 3.10 billion in 2024, is poised for significant growth. It is predicted to expand at a robust CAGR of 25.2% to reach USD 18.72 billion by 2032. This forecast period is marked by increasing investments in high-density technology, high-performance computing, and smart city initiatives. These factors are driving state and local players to develop the most reliable and efficient cooling methods for their data centers.
The surge in IT investment and the incorporation of IT into all activities has resulted in the collection of massive amounts of data. Such information is stored, processed, and transported over many servers that are layered one on top of the other. Day in and day out, these systems and possible cyber threats face one major threat: heat. Every electrical gadget generates heat when powered by an alternating current (AC) or direct current (DC).
The heat generated by servers and IT systems, if left unregulated, can lead to malfunctioning, melting, or damage to the server's chipsets and components. This is where liquid cooling technology plays a crucial role. The IBM 3033 and the Cray-2 were pioneers in using liquid cooling in the 1970s. In the past decade, the focus has shifted towards creating practical industrial-grade liquid cooling systems for data center use, driven by the need to minimize energy usage. Liquid immersion systems, such as submerging servers and other components in thermally conductive but not electrically conductive liquids like mineral-based lubricants, are now in use.
Simultaneously, data centers are expanding rapidly to accumulate all the data generated every second. Such functioning of data centers consumes and exerts a lot of heat and energy. Hence, cooling facilities are needed to efficiently sustain the performance of the hardware. Cooling facilities are designed to be modified to provide adequate performance regardless of the heat generated, and growing concerns about saving the environment and energy are just a few of the factors that could fuel and drive demand for data center liquid cooling over the forecast period. The data center liquid cooling industry is expected to develop as sophisticated engineering coolants are used to provide cooling with a lower carbon footprint. Liquids are superior conductors of heat energy because they are denser than air and provide an effective cooling medium.
Along with electricity, liquids are both conductive and corrosive, and any breach in the data center's liquid cooling system can be disastrous for the facilities and equipment. As a result, the data center liquid cooling market faces a significant challenge.
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REPORT METRIC |
DETAILS |
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Market Size Available |
2023 to 2032 |
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Base Year |
2023 |
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Forecast Period |
2024 to 2032 |
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CAGR |
25.2% |
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Segments Covered |
By Component, Data Centre Type, Solution, End-user, and Region |
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Various Analyses Covered |
Global, Regional & Country Level Analysis, Segment-Level Analysis, DROC, PESTLE Analysis, Porter’s Five Forces Analysis, Competitive Landscape, Analyst Overview on Investment Opportunities |
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Regions Covered |
North America, Europe, APAC, Latin America, Middle East & Africa |
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Market Leaders Profiled |
Asetek (Denmark), Rittal (Germany), Stulz (Germany), Vertiv (US), Schneider Electric (France), Alfa Laval (Sweden), Fujitsu (Japan), Asperitas (Netherlands), Allied Control (Hong Kong), DCX (Poland) and Others. |
The solution sector dominated the data center cooling market in 2020, and it is likely to continue to do so in the coming years, owing to an increase in the number of energy-efficient cooling solutions. Liquid cooling in data centers can take several forms, including sealed plates over processors, liquid compressors to cool air, or immersion in specially engineered fluids for cooling. Major suppliers offer a variety of liquid cooling options, while niche and developing vendors offer niche and emerging liquid cooling solutions. Due to their usefulness in high-density cooling, data center liquid cooling technologies are garnering a lot of interest from large end-users.
The component sector had the highest CAGR in the data center cooling market, owing to an increase in the number of service providers for installation and deployment, support and maintenance, and consulting for data center cooling solutions. Cooling systems in data centers must be installed correctly, as leaks in the cooling system can damage equipment
Hyperscale data centers dominate the industry in terms of type. This is the case since most major hyper-scale and cloud service providers have promised better energy efficiency and lower carbon emissions. These companies include Google LLC, Facebook, Microsoft, and Amazon AWS. The rising emphasis on cloud migration is another element contributing to this. More businesses worldwide are considering or have switched to cloud computing for some of their operations.
In the data center liquid cooling industry, indirect cooling is predicted to lead the market by solution type. This is owing to the widespread use of indirect cooling systems and their increased availability. Compared to direct cooling technologies such as immersion and direct-to-chip cooling, the indirect cooling market has a larger number of vendors and manufacturers, allowing it to take the lead.
The IT and telecom industry leads the data center liquid cooling market by end-use industry. The major user of data centers in the telecommunications industry. Because data transmission and delivery operations require better connectivity, data centers are an important part of the ICT industry. Because communication is the most important aspect of the ICT industry's success, data centers have become indispensable. As a result, the IT and telecom industries have the biggest need for data center liquid cooling.
Europe's data center liquid cooling market accounted for over 30% of revenue share in 2023, owing to the increasing expansion of data centers across the region. Because of favorable environmental characteristics such as easy availability of land, low power, accessible renewable energy, and tax advantages, data center service providers are encouraged to invest in this location. By 2029, Europe will be the main data center liquid cooling market, with a market value of USD 2.5 billion. This is due to widespread support for environmentally friendly legislation and a growing emphasis on energy efficiency across practically all industrial sectors. Aside from that, the European Union has enacted a Green Deal that lays out ambitions to make the whole data center and information and communications technology (ICT) business carbon neutral by 2030.
The data center liquid cooling market in the United States is expected to increase 17 percent annually through 2029, owing to government rules to decrease carbon footprints from high-density data centers. For example, the United States government's Federal Energy Management Program (FEMP) pushes companies and agencies to increase data center energy efficiency through its Center of Expertise (CoE). Operators are working on deploying innovative cooling solutions to preserve efficiency because cooling systems account for 30 percent to 60 percent of energy usage in data centers.
Demand for data center liquid cooling solutions from cloud service providers is predicted to expand at a CAGR of 27% in China by 2029, owing to an increase in the number of data centers built in the country due to growing government worries about the security of client data. China's Cybersecurity Law, for example, imposes data localization requirements on important data center operators to process, store, and analyze data within China's boundaries. This has prompted cloud service providers to build data centers in the country to securely handle enormous amounts of data.
By Component
By Data Centre Type
By Solution
By End-User
By Region
Frequently Asked Questions
Emerging economies, particularly in regions like Latin America and Africa, are experiencing a surge in demand for high-density computing due to the rapid digitization of industries and the growing popularity of cloud services. Liquid cooling solutions offer an efficient way to dissipate heat generated by densely packed servers, enabling data centers in these regions to meet performance requirements while optimizing space and energy utilization.
Oceania, characterized by its island geography and diverse climate patterns, faces unique challenges in maintaining optimal operating conditions for data centers. Advancements in liquid cooling technologies, including modular and hybrid cooling solutions, offer scalability and adaptability to varying environmental conditions, enabling data center operators in Oceania to achieve efficient cooling performance while maximizing resource utilization.
In developing countries, factors such as infrastructure investment, operational costs, and access to technology financing play a crucial role in determining the pace of adoption of data center liquid cooling solutions. Economic considerations, coupled with the need to address the challenges of heat dissipation and energy consumption, drive the evaluation of cost-effective and scalable cooling solutions tailored to the specific requirements of emerging markets.
Key trends such as the proliferation of edge computing, the rise of hyperscale data centers, and the integration of artificial intelligence (AI) and machine learning (ML) in cooling optimization are shaping the global data center liquid cooling market. Additionally, innovations in cooling architectures, such as 3D immersion cooling and distributed pumping systems, are poised to redefine the landscape of data center cooling solutions, catering to evolving industry demands for efficiency, scalability, and sustainability.
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