Critical Power and Cooling Market – Global Industry Size, Share, Trends, Opportunity, and Forecast Segmented By Critical Power Type (UPS, Generators and Others), By Cooling Solutions Type (Chilling Units, Cooling Towers, Air Conditioning, Liquid Cooling Systems and Others), By End-Use (Commercial, IT & Telecommunication, Industrial, Transportation and Others), By Region, By Competition Forecast &

Market Overview

The Global Critical Power and Cooling Market was valued at USD 21.95 billion in 2022 and is growing at a CAGR of 7.73% during the forecast period. The growing number of data centers for cloud computing and digitalization is expected to drive market growth in the forecast period. The market will also benefit from the increased demand for power in various sectors, including hospitals, facilities, financial services, banking, and power plants. The critical power supply and cooling system industry is projected to grow due to the rising need for improved cooling efficiency in data centers, the requirement to reduce power supply anomalies, and the implementation of regulations and initiatives by institutions and associations.

Key Market Drivers

Increasing Reliance on Digital Infrastructure and Data Centers

The critical power and cooling market is witnessing significant growth due to the escalating reliance on digital infrastructure and data centers across diverse industries. In today's digital era, businesses, governments, and organizations heavily rely on data processing, storage, and seamless connectivity to ensure efficient operations. This dependence on digital technologies has resulted in the proliferation of data centers, encompassing both large-scale and edge facilities, to manage the vast volumes of data generated and processed daily.

As the global data volume continues to soar, data centers necessitate robust critical power and cooling solutions to ensure uninterrupted operation and prevent costly downtime. The demand for high-performance uninterruptible power supply (UPS) systems, precision cooling solutions, and advanced monitoring and management tools has surged. These technologies ensure data centers can maintain a stable operating environment, safeguard sensitive equipment, and deliver uninterrupted services, which is vital for sectors such as finance, healthcare, e-commerce, and cloud computing.

Furthermore, the growth of Internet of Things (IoT), artificial intelligence (AI), and 5G technology further amplifies the need for critical power and cooling solutions. These technologies require data processing at the edge, closer to end-users, necessitating the deployment of edge data centers that rely on resilient power and cooling infrastructure. As a result, the critical power and cooling market are expected to continue flourishing in response to the global digitization trend.

Increased Awareness of Energy Efficiency and Environmental Sustainability

Energy efficiency and environmental sustainability have become paramount concerns in the present world, driving the adoption of eco-friendly critical power and cooling solutions. As businesses and organizations strive to reduce their carbon footprint and energy consumption, they are increasingly turning to energy-efficient technologies in critical infrastructure.

One of the key drivers in this regard is the rising cost of energy. Energy expenses constitute a significant portion of operational costs for data centers and critical facilities. To mitigate these costs, organizations are seeking power and cooling solutions that optimize energy usage without compromising reliability. Energy-efficient UPS systems, cooling units with advanced economization features, and smart management systems are in high demand.

Furthermore, environmental regulations and corporate sustainability initiatives are pushing organizations to implement greener practices. Critical power and cooling technologies that reduce energy consumption and utilize refrigerants with lower global warming potential (GWP) are favored. Additionally, some organizations are investing in renewable energy sources and energy storage solutions to power critical infrastructure, further reducing their environmental impact.

In summary, the increased awareness of energy efficiency and environmental sustainability is a strong driver in the critical power and cooling market. Manufacturers are responding by developing innovative solutions that minimize energy consumption, enhance efficiency, and align with sustainability goals.

Growth of Edge Computing and Decentralized Infrastructure

The rapid expansion of edge computing and decentralized infrastructure is a significant catalyst for the critical power and cooling market. Edge computing involves processing data in close proximity to the source or end-users, resulting in reduced latency and enhanced real-time decision-making. This trend holds particular significance for applications such as autonomous vehicles, IoT devices, and augmented reality, where low-latency data processing is of utmost importance.

In order to support edge computing, a network of decentralized smaller data centers and micro data centers is emerging. These facilities are strategically distributed across various locations, including the network edge, retail retailers, and manufacturing facilities. However, these edge data centers face distinct challenges, including limited space, fluctuating environmental conditions, and the requirement for reliable critical power and cooling solutions.

As organizations invest in edge computing infrastructure, there is an increasing demand for compact and energy-efficient critical power and cooling solutions specifically designed for these smaller data centers. UPS systems with a reduced footprint, scalable cooling solutions, and remote monitoring capabilities are highly sought after to ensure the dependability of edge infrastructure.

Furthermore, the deployment of edge data centers is often driven by the need for redundancy and disaster recovery. In critical applications such as autonomous vehicles and healthcare, uninterrupted data processing is absolutely crucial. This dependency on redundant edge facilities further intensifies the necessity for robust and efficient critical power and cooling solutions.

In conclusion, the growth of edge computing and decentralized infrastructure is reshaping the critical power and cooling market. The demand for compact, energy-efficient, and reliable solutions to support edge data centers is projected to drive continuous market growth in the foreseeable future.

Key Market Challenges

Increasing Energy Costs and Sustainability Pressures

One of the primary challenges facing the global critical power and cooling market is the increasing energy costs and the mounting pressure for sustainability. Critical facilities, such as data centers, hospitals, and industrial complexes, are substantial electricity consumers due to their constant need for uninterrupted operation. This substantial energy consumption not only significantly raises operational expenses but also raises environmental concerns regarding carbon emissions.

As energy prices continue to rise, operators of critical facilities are grappling with the challenge of managing escalating operational costs. Energy expenditure can become a significant portion of their budgets, impacting profitability and overall competitiveness. In this context, prioritizing ways to optimize energy usage and reduce consumption without compromising the reliability of critical power and cooling systems is of utmost importance.

Simultaneously, global sustainability initiatives and environmental regulations are driving organizations to reduce their carbon footprint and embrace eco-friendly practices. There is a growing demand for critical power and cooling solutions that are energy-efficient and environmentally sustainable. This necessitates the development of innovative technologies, such as advanced cooling systems with economization features, energy-efficient uninterruptible power supply (UPS) systems, and renewable energy integration, to align with sustainability goals.

Addressing these dual challenges of rising energy costs and sustainability pressures requires substantial investment in research and development to design and produce critical power and cooling solutions that are not only highly reliable but also energy-efficient and environmentally responsible.

Rapid Technological Advancements and Evolving Infrastructure Needs

The rapid pace of technological advancements and the evolving infrastructure needs of critical facilities present a complex challenge for the critical power and cooling market. Technology is continuously evolving, leading to more sophisticated and power-hungry equipment within these facilities. Consequently, the power and cooling infrastructure must keep pace with these advancements to maintain reliable operation.

For instance, data centers are adopting high-performance computing (HPC), artificial intelligence (AI), and machine learning (ML) technologies, which generate substantial heat and require advanced cooling solutions. Meeting the cooling demands of such technologies while ensuring energy efficiency is a significant challenge.

Moreover, the expansion of edge computing and the deployment of decentralized infrastructure introduce new requirements. Edge data centers are often located in environments with limited space, harsh conditions, and unique cooling challenges. Developing compact, resilient, and energy-efficient critical power and cooling solutions tailored to these scenarios presents a formidable obstacle.

Additionally, the COVID-19 pandemic highlighted the importance of remote monitoring and management capabilities in critical facilities. This necessitates the integration of advanced digital technologies, such as IoT sensors and predictive analytics, into critical power and cooling systems.

To address these challenges, manufacturers must maintain a constant focus on research and development, innovation, and collaboration with customers to ensure that critical power and cooling solutions evolve to meet the ever-changing technology landscape and infrastructure needs.

Strict Regulatory Compliance and Cybersecurity Concerns

Strict regulatory compliance and cybersecurity concerns pose significant challenges for the global critical power and cooling market. Critical facilities, particularly those in sectors like healthcare, finance, and data centers, must adhere to strict regulatory frameworks to ensure the reliability and security of their operations.

Complying with regulations related to data privacy, reliability, safety, and environmental standards can be intricate and costly. For example, data centers are subject to a multitude of regulations, including those governing data security (e.g., GDPR), energy efficiency (e.g., ASHRAE standards), and emissions (e.g., Kyoto Protocol). Meeting these requirements necessitates the integration of specialized technologies and practices within critical power and cooling systems.

Furthermore, as critical infrastructure becomes more interconnected and digitally dependent, it becomes a prime target for cyberattacks. Ensuring the cybersecurity of critical power and cooling systems is imperative to prevent unauthorized access, data breaches, and potential system disruptions.

Manufacturers and operators in the critical power and cooling market must invest in cybersecurity measures, such as firewalls, intrusion detection systems, and secure communication protocols. Moreover, they must stay vigilant in keeping up with evolving cybersecurity threats and compliance regulations, adapting their solutions and practices accordingly.

In summary, successfully navigating the challenges of strict regulatory compliance and cybersecurity concerns requires a multifaceted approach that combines technological innovation, regulatory expertise, and a proactive cybersecurity stance to ensure the reliability and security of critical power and cooling systems in critical facilities.

Key Market Trends

Increased Focus on Energy Efficiency and Sustainability

One of the significant trends observed in the global critical power and cooling market is the increased emphasis on energy efficiency and sustainability. With the surge in energy costs and growing environmental concerns, organizations across various industries are actively seeking ways to reduce their carbon footprint and optimize energy consumption in critical facilities. In this context, critical power and cooling solutions are undergoing a transformation to enhance energy efficiency and promote environmental friendliness.

Advanced Cooling Technologies

Efficient UPS Systems

Renewable Energy Integration

Energy Management Systems

By addressing these aspects, organizations can effectively enhance the energy efficiency and sustainability of their critical power and cooling infrastructure while aligning with the global push towards greener practices.

Edge Computing and Edge Data Centers

The growth of edge computing is fueling a significant trend in the critical power and cooling market. Edge computing involves processing data in close proximity to its source or end-users, reducing latency and enabling real-time data analysis. This trend is particularly relevant in applications such as the Internet of Things (IoT), autonomous vehicles, and augmented reality, where low-latency data processing is imperative.

The deployment of smaller data centers or micro data centers across various locations, including the network edge, manufacturing facilities, and retail retailers, is essential for edge computing. These edge data centers have distinct requirements for critical power and cooling

Compact and Scalable Solutions

Given the constrained spaces of edge data centers, it is crucial to have compact and scalable critical power and cooling solutions that can fit into these environments.

Redundancy and Reliability

Ensuring uninterrupted data processing in critical applications like autonomous vehicles or healthcare requires redundancy and high reliability in power and cooling systems.

Energy Efficiency

With the distributed nature of edge computing, energy efficiency plays a pivotal role in minimizing operating costs and environmental impact.

The trend towards edge computing is driving the development of specialized critical power and cooling solutions tailored to these unique requirements. Manufacturers are designing equipment that can operate efficiently in diverse environmental conditions while maintaining high levels of reliability.

Segmental Insights

Critical Power Type Insights

The UPS segment holds a significant market share in the Global Critical Power and Cooling Market. The Uninterruptible Power Supply (UPS) segment holds immense significance in the global critical power and cooling market. UPS systems play a pivotal role in safeguarding against power interruptions, ensuring continuous operation of critical infrastructure across various industries.

Data centers, encompassing both large-scale and edge facilities, stand out as major consumers of UPS systems. The surge in demand for data centers, driven by cloud computing, digital services, and the Internet of Things (IoT), has propelled the UPS market forward. UPS systems assume a critical role in industrial automation and control systems, guaranteeing uninterrupted operation and mitigating costly downtime.

The advent of the digital transformation has underscored the importance of uninterrupted power supply. Organizations now heavily rely on data processing, real-time communication, and digital services, making UPS systems indispensable in preventing data loss and service disruptions.

The adoption of lithium-ion batteries in UPS systems is on the rise, owing to their longer lifespan, higher energy density, and smaller footprint compared to traditional lead-acid batteries. Lithium-ion technology also facilitates faster recharge times. Modular UPS designs offer scalability and redundancy, empowering organizations to expand their critical power infrastructure as per their requirements. This ongoing trend enhances flexibility and lowers the total cost of ownership.

Cooling Solutions Type Insights

The IT & Telecommunication segment holds a significant market share in the Global Critical Power and Cooling Market. The IT and Telecommunication segment is a crucial component of the global critical power and cooling market. In this era of digitalization, ensuring uninterrupted operation of IT infrastructure and telecommunications networks is of utmost importance. Critical power and cooling solutions play a pivotal role in ensuring reliability. The exponential growth of digital data, cloud computing, and online services has led to the proliferation of data centers worldwide. These power-intensive facilities require robust critical power and cooling solutions to maintain round-the-clock operation.

The ongoing digital transformation across industries heavily relies on IT infrastructure and telecommunications networks. Enterprises and organizations depend on data processing, real-time communication, and digital services, making reliable power and cooling solutions indispensable. Stringent data security and compliance regulations mandate the use of critical power solutions to safeguard sensitive information. Data breaches and network downtime can have severe financial and reputational implications.

The adoption of lithium-ion batteries in uninterruptible power supply (UPS) systems is witnessing growth due to their higher energy density, longer lifespan, and smaller physical footprint. These batteries offer advantages such as reduced maintenance requirements and faster recharge times. Modular UPS designs provide scalability and redundancy, empowering organizations to expand their critical power infrastructure as per their requirements. This emerging trend enhances flexibility and lowers the total cost of ownership.

Regional Insights

The North America region is expected to dominate the market during the forecast period. North America plays a significant role in the global critical power and cooling market, propelled by a combination of factors including technological advancements, increased digitalization, adherence to regulatory standards, and a robust demand for reliable power infrastructure.

North America houses a substantial number of data centers, driven by the soaring demand for cloud computing, big data, and digital services. The continuous expansion of data centers necessitates resilient critical power and cooling solutions to ensure uninterrupted operations. The region has experienced rapid growth in edge computing, with the deployment of edge data centers to reduce latency and support real-time applications. These edge facilities require specialized critical power and cooling infrastructure.

The United States and Canada have well-established emissions standards for generators and cooling systems. Compliance with emissions regulations such as Tier 4 in the U.S. fuels the adoption of advanced emission control technologies. The region also upholds stringent data privacy regulations, including the Health Insurance Portability and Accountability Act (HIPAA) and the General Data Protection Regulation (GDPR). Compliance with these regulations necessitates reliable power infrastructure to safeguard data integrity and security.

Industries such as finance, healthcare, telecommunications, and manufacturing heavily rely on uninterrupted power to ensure seamless business continuity. This drives the demand for resilient critical power systems. Critical facilities such as hospitals and emergency services depend on backup power to guarantee patient care and public safety during grid outages or natural disasters.

Recent Developments

• In February 2019, nVent unveiled two cutting-edge smart precision liquid cooling platforms designed to effectively manage high heat loads and critical cooling needs in data center computing, server, and storage racks. The in-row chiller boasts an impressive cooling performance of up to 55KW, when connected to a chilled water inlet temperature of 14°C.

Key Market Players

• ABB Ltd.
• Ac Power Corp.
• Asetek A/S
• Eaton Corporation
• General Electric Company
• Riello Elettronica Group
• Rittal GmbH & Co. Kg
• SPX Corporation
• Schneider Electric SE
• Siemens AG