Data Centre Cooling Market Overview

⇒ The Global Data Centre Cooling Market was valued at USD 12.87 billion in 2024 and is projected to reach USD 33.45 billion by 2034, growing at a CAGR of 10.1% during the forecast period 2025–2034.

In 2024, experts predict that such a significant part of global electricity consumption is fed into global data centres that consume cooling. From that year on, the market is expected to increase toward 2034 because the digital infrastructure is rapidly expanding, which is hastened by artificial intelligence and high-performance computing. While revenues projections from public sources are not made available, it is reported by the DOE and the Lawrence Berkeley National Laboratory that data centres in the United States consumed about 176 terawatt-hours (TWh) of electricity during the year 2023, which translates to about 4.4% of total U.S. electricity demand. The projection makes plausible that the increase would occur between 325 TWh and 580 TWh by the year 2028 depending on the intensity of IT growth and embracing new energy-efficient cooling systems.

Government-backed institutions are very active to support development of technologies dealing with the increased energy intensity of cooling infrastructures. The Federal Energy Management Program by the U.S. Department of Energy (DOE) optimizes the federal data centres’ effectiveness in power usage effectiveness (PUE) and water usage effectiveness (WUE) by providing efficient guides and resources. At the same time, pilot projects like Cold Underground Thermal Energy Storage (Cold UTES), developed with the aid of the National Renewable Energy Laboratory (NREL), are explored as scalable approaches to providing reliable grid improvements and making reductions in peak cooling loads. These highlight the need for sustainable infrastructure within national digital strategies.

Globally, such initiatives correspond with climate policy goals and encourage much of the field operators in their journey to transition toward low-impact cooling technologies. The market for global data Centre cooling is not readily quantified publicly, but the demand for energy and energy-related expenditures to fund more advanced federal and global programs to improve thermal efficiency has significantly contributed to the market momentum. The tightening of energy standards along with increased workloads enabled by AI is projected to surge the demand for optimized cooling and serve as a prime point for direction in the planning of digital infrastructure for the long term.

Market Drivers

• Rising IT Load and Governmental Support for Sustainable Data Infrastructure

National governments are investing in new thermal management technologies to meet the growing demands of data centres on the energy front, thanks to their increased cooling needs. The U.S. Department of Energy estimates that, in 2023, data centres in the United States alone used approximately 176 terawatt-hours (TWh) of electricity, with cooling systems accounting for 30-40% of the total. In response, the DOE's Advanced Research Projects Agency-Energy initiated COOLERCHIPS in 2023, with over USD 40 million of funding committed to energy-efficient cooling technologies, including two-phase liquid cooling, direct-to-chip cooling, and innovative system architectures. In addition to these public initiatives, some states have also adopted mandates, such as California, where utility programs will incentivize efficient data centre operations. Although small international efforts like the EU's "Code of Conduct for Data Centres" continue to propel energy efficiency benchmarks, such strides are usually confined to public sector approaches. With governments gearing up for decarbonization goals under frameworks like the Paris Agreement, the public sector's backing toward further advanced cooling solutions for commercial application would make it scalable and deployable for both public and private digital infrastructure projects.

• Policy Push for Energy Optimization and Grid Resilience

As climate change and strain on the grid get heavier, programs by governments are increasingly targeting energy efficiency in data centres and more importantly, through improved cooling systems. The U.S. Federal Energy Management Program (FEMP) advises and assists government agencies in reducing energy and water use for data centre operations, providing toolkits and technical assistance in implementing energy-efficient technologies. In parallel, the National Renewable Energy Laboratory (NREL) investigates long-duration thermal energy storage technologies such as Cold Underground Thermal Energy Storage (Cold UTES), aimed at peak load demand relief and improved flexibility for the power grid. These efforts resonate with larger Department of Energy goals, like the Better Buildings Challenge, which has energy efficiency targets for federal data centres. Outside the U.S., pilot projects funded by the Japan Ministry of the Environment and Germany’s Federal Ministry for Economic Affairs and Climate Action are investigating AI-integrated cooling systems and modular solutions. In this way, the programs create an ecosystem where national standards not only support but actively necessitate low-PUE technologies.

Market Opportunity

• AI-Based Cooling Optimization and Public-Sector Demonstration Projects

Research institutions funded by governments are starting to play with AI-based control systems and hybrid cooling architectures for the ever-increasing thermal loads of data centres. A good example of this is the Cold UTES Cold Underground Thermal Energy Storage project sponsored by the U.S. Department of Energy and led by the National Renewable Energy Laboratory (NREL) in a bid to reduce the energy cost of cooling by storing and managing cold energy underground. At the same time, the Pacific Northwest National Laboratory (PNNL) and Lawrence Berkeley National Laboratory (LBNL) are testing smart thermal monitoring systems that actively tune cooling intensities to server workloads. These initiatives help to crystallize a federal push toward digitizing efficiency, as shown in the 2023 DOE Data Centre Energy Practitioner (DCEP) initiative. The application of AI, ML, and high-density compute workloads is also increasing the demand for intelligent cooling platforms that can self-adjust in real-time. This creates a tremendous opportunity for companies in the private sector to collaborate with the government to co-develop technologies and gain access to multi-million-dollar demonstration grants, utility incentives, and pilot procurement contracts that will target the optimization of next-generation data infrastructure.

Market Restraining Factor

• High Cost of Retrofit and Technical Complexity in Legacy Data Centres

The market remains constrained for retrofitting existing data centres with well-tech potentials via modern cooling systems because it costs a lot and requires engineering limitations. Retrofitting a 1 MW legacy data centre with liquid or hybrid cooling systems may cost more than USD 1.5-1.8 million on average, according to the U.S. General Service Administration (GSA). This includes upgrades to containment architecture, plumbing systems, and thermal controls. Modifications typically require some parts to be offline or phased in, resulting in disruptions to critical IT operations. Also, many older facilities do not have structural features that would support heavier cooling assemblies or redundant fluid delivery systems, presenting further complications for integration. Furthermore, insufficient funding in public sector IT departments, especially from small municipalities or other low-government institutions outside major cities, causes a delay in modernization. Another obstacle includes a lack of standardized retrofit pathways and further exacerbation of technical issues because very specialized technicians are needed. Without massive federal subsidies/interventions and stricter mandates for thermal efficiency, it is expected that most legacy sites will postpone upgrades in cooling systems, causing a bottleneck in the overall market penetration for next-generation solutions.

Segmentation Analysis

By Solution Type

The market is brimming with innumerable cooling solutions, designed for evolving thermal needs in state-of-the-art data centres. Air-based cooling is the most ancient among other systems, comprising chillers, CRAH units, and cooling towers. In fact liquid-based cooling systems are now being used because they are also very effective in higher heat loads. Methods such as direct-to-chip cooling or rear-door heat exchangers have contributed to the growing popularity of liquid-based cooling. Increasingly hybrid systems designed as a combination of both air and liquid systems are being applied to retrofitted spaces. Precision cooling will allow much more targeted airflow and temperature control for high-density and modular data centre facilities. Moreover, immersion cooling gives promise as it transforms the whole environment of having IT equipment submerged in dielectric fluids to maximize heat transfer while using relatively lesser energy.

By Component

The components of cooling systems at data centres are classified amongst the main definition components of hardware, software, and services. The hardware usually comprises the coolers, chillers, air handling units (AHU), heat exchanger systems, and pump systems which provide the primary infrastructure to facilitate the removal of heat. The software includes the monitoring and control systems for real-time tracking and optimization of cooling performance, hence contributing to energy efficiency and operational reliability. Services such as installation, preventive maintenance, and consultancy services form a significant contributor to the successful implementation of cooling solutions and their long-term performance guarantees especially in view of the scalability and complexity of data centres.

By Data Centre Type

Cooling strategies vary across different data centre forms. Cooling requirements will change according to size, pitch, and the way these centres are operated. Enterprise data centres are predominantly owned and operated by a single company. Such facilities tend to prefer cost-effective scalable cooling systems. The colocation data centres house several clients. As a result, these facilities must provide flexible and redundant cooling infrastructures for other tenant needs. Since these cloud and tech behemoths own hyperscale data centres, they inevitably require new high-efficient cooling technologies to serve extreme densities and subsequently lower PUE levels. The edge data centres or those located closer to end users for low-latency processing tend to focus more on compact, energy-efficient cooling systems built for space-constrained environments.

By Cooling Technique

There are cooling techniques that differ in density of the racks, layout, and operational objectives. Row-based cooling locates cooling units right between server rows, and thus it provides localized airflow and improves thermal management even within high-density zones. Rack-based cooling, which means that cooling systems are directly part of the server racks, allows for more exact heat extraction and works great for high-performance workloads. Compared to older room-based configurations of cooling, these technologies are beneficial by effectively controlling airflow and using less energy; hence, they are worth taking into consideration in the designs of modern modular and scalable data centres.

By Industry Vertical

Availability of data centre cooling technologies is across sectors. In BFSI, reliable cooling ensures uninterrupted operation of financial systems. IT & telecom is a big market in that it needs enormous cloud infrastructure and digital services. Government & defence demand secure and resilient cooling measures for mission-critical systems. Healthcare depends on constant cooling for the protection of sensitive patient data and imaging systems. Manufacturing with industrial IoT systems depends a lot on thermal management for uninterrupted operations. Energy & utilities depend on cooling in maintaining the stability of control systems and smart grid platforms. Media & entertainment lay emphasis on high-performance cooling to support streaming and rendering workloads while delivering content at scale.

Regional Snapshot

• North America

America leads by a long distance the data centre cooling space, owing to its robust funding as well as mature energy efficiency standards and advanced infrastructure deployment. Several agencies including the US Department of Energy (DOE), advanced Research Projects Agency-Energy of DOE (ARPA E), Federal Energy Management Program (FEMP), among many others, are funding pilot projects, grants, and consultancy guidelines for more efficient immersion, economizers, and thermal energy storage cooling technologies. The various energy agencies in Canada facilitate research and pilot implementations through grant programs with the aim of reducing data Centre PUE and WUE. For example, California has an array of subsidies and incentive schemes to support the sustainable design of data centres. Often, public procurement policies enforce low-impact cooling configurations for government-run IT facilities; this reinforcement ultimately keeps North America on the efficiency track regarding data centre infrastructure right from the first.

• Europe

Among various efforts comprising national decarbonization and energy efficiency strategies such as the European Commission Green Deal and the Code of Conduct for Data Centres, data centre cooling is also completely under national coverage, which includes countries like Germany, the UK, and the Netherlands. National public energy agencies and national research labs fund innovations in cooling, such as liquid cooling pilot initiatives and AI-based thermal optimization trials. The proposals support the EU climate objectives and include provisions for public-private partnerships focusing on reduced energy consumption and grid-friendly operation. In addition, European green building certification bodies are embedding cooling performance criteria into data centre design standards, thus enhancing the pressure for efficient thermal systems.

• Asia‑Pacific

Japan, South Korea, Singapore, and Australia are embarking on dramatic public-sector fission spending on data centre cooling technologies in relation to their energy transition and proliferation policies in the digital domain. For instance, Japan and South Korea's government-aided research institutions would be piloting modular cooling architectures, intelligent thermal controls, and AI-integrated cooling with grid-interconnection attributes. Singapore's Energy Market Authority supports experiments in thermal energy optimization for hyperscale campus infrastructures. India's Ministry of Power and the national research laboratories are preparing to implement programs on energy benchmarking which include cooling efficiency metrics as part of forthcoming data centre efficiency codes. All these efforts together serve as defining achievements for cooling infrastructure revision across the Asia-Pacific region.

• Latin America

Some countries such as Brazil and Mexico are starting to include data centre cooling efficiency in their national digital strategy plans, especially under regulations and utilities. Mostly in major IT hubs, energy audits and pilot grants are being initiated by the government to push for the modernization of the cooling architecture. Ultimately, programs for public-sector cloud adoption increasingly include minimum PUE standards, while grant allocation seeks to support the transition toward efficient cooling technologies in emerging enterprise and hyperscale facilities.

• Middle East & Africa

GCC countries have important sovereign digital strategy agendas which strongly emphasize investments in next-generation data infrastructure, mainly for the United Arab Emirates, Saudi Arabia, and Qatar. National development funds and government-driven data centre clusters are prioritizing evaporative cooling, energy reuse systems, as well as the introduction of liquid cooling in hyperscale settings. Energy-efficiency benchmarking initiatives for hyperscale and enterprise data centres, including guidance on the use of appropriate cooling solutions for different climates, have begun by South Africa's Department of Energy and Research Councils. Such regional initiatives lay bare the growing strategic importance of sustainable cooling throughout the Middle East & Africa.

List of Top Leading Companies

• Vertiv Group Corp.
• Schneider Electric SE
• Stulz GmbH
• Black Box Corporation (AAG)
• Rittal GmbH & Co. KG
• Eaton Corporation plc
• Airedale International Air Conditioning Ltd.
• Delta Electronics, Inc.
• Hitachi, Ltd.
• Fujitsu Limited
• Trane Technologies plc
• CoolIT Systems Inc.
• Munters Group AB
• Huawei Technologies Co., Ltd.
• Lennox International Inc.

Key Industry Developments

• 2024: Vertiv launched a next-generation liquid cooling solution tailored for high-density data centers, focusing on AI and HPC workloads.
• 2023: Schneider Electric poured additional grease into its EcoStruxure™ data centre cooling portfolio, leveraging intelligent edge applications for modular deployments.
• 2024: Rittal inaugurated a thermal management testing lab in Germany to accelerate the development of energy-efficient cooling solutions.
• 2023: Schneider Electric poured additional grease into its EcoStruxure™ data centre cooling portfolio, leveraging intelligent edge applications for modular deployments.

Report Coverage

The report will cover the qualitative and quantitative data on the Global data-centre-cooling-market. The qualitative data includes latest trends, market players analysis, market drivers, market opportunity, and many others. Also, the report quantitative data includes market size for every region, country, and segments according to your requirements. We can also provide customize report in every industry vertical.

Report Scope and Segmentations

Global Data Center Cooling Market Regional Analysis

North America accounted for the highest xx% market share in terms of revenue in the Data Center Cooling market and is expected to expand at a CAGR of xx% during the forecast period. This growth can be attributed to the growing adoption of Data Center Cooling. The market in APAC is expected to witness significant growth and is expected to register a CAGR of xx% over upcoming years, because of the presence of key Data Center Cooling companies in economies such as Japan and China.

The objective of the report is to present comprehensive analysis of Global Data Center Cooling Market including all the stakeholders of the industry. The past and current status of the industry with forecasted market size and trends are presented in the report with the analysis of complicated data in simple language.

Data Center Cooling Market Report is also available for below Regions and Country Please Ask for that

North America

• U.S.
• Canada

Europe

• Switzerland
• Belgium
• Germany
• France
• U.K.
• Italy
• Spain
• Sweden
• Netherland
• Turkey
• Rest of Europe

Asia-Pacific

• India
• Australia
• Philippines
• Singapore
• South Korea
• Japan
• China
• Malaysia
• Thailand
• Indonesia
• Rest Of APAC

Latin America

• Mexico
• Argentina
• Peru
• Colombia
• Brazil
• Rest of South America

Middle East and Africa

• Saudi Arabia
• UAE
• Egypt
• South Africa
• Rest Of MEA

Points Covered in the Report

• The points that are discussed within the report are the major market players that are involved in the market such as market players, raw material suppliers, equipment suppliers, end users, traders, distributors and etc.
• The complete profile of the companies is mentioned. And the capacity, production, price, revenue, cost, gross, gross margin, sales volume, sales revenue, consumption, growth rate, import, export, supply, future strategies, and the technological developments that they are making are also included within the report. This report analysed 12 years data history and forecast.
• The growth factors of the market are discussed in detail wherein the different end users of the market are explained in detail.
• Data and information by market player, by region, by type, by application and etc., and custom research can be added according to specific requirements.
• The report contains the SWOT analysis of the market. Finally, the report contains the conclusion part where the opinions of the industrial experts are included.

Key Reasons to Purchase

• To gain insightful analyses of the Data Center Cooling market and have comprehensive understanding of the global market and its commercial landscape.
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• To understand the most affecting driving and restraining forces in the market and its impact in the global market.
• Learn about the Data Center Cooling market strategies that are being adopted by leading respective organizations.
• To understand the future outlook and prospects for the Data Center Cooling market. Besides the standard structure reports, we also provide custom research according to specific requirements.

Research Scope of Data Center Cooling Market

• Historic year: 2019-2023
• Base year: 2024
• Forecast: 2025 to 2034
• Representation of Market revenue in USD Billion

Data Center Cooling Market Trends: Market key trends which include Increased Competition and Continuous Innovations Trends: