The Data Center Power Market is set for robust growth between 2025 and 2029, driven by expanding digital transformation initiatives, cloud computing, and the increasing adoption of IoT. According to recent research, the market is expected to grow by USD 24.05 billion during the forecast period, expanding at a CAGR of 10.8%. In 2024, the market stood at a strong baseline, and by 2029, it is projected to reach significantly higher valuations, reflecting increased global demand for high-availability IT infrastructure.
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A primary driver of the data center power market is the rising global investment in data centers. This is fueled by the massive influx of data generated by enterprises and consumers alike. Businesses are investing heavily in hyperscale and edge data centers to support services like 5G, big data analytics, and multi-cloud environments. Efficient power management systems have become essential, as they ensure uptime and reduce operational risks. Power components such as server racks, precision air conditioning, and thermal management systems play a critical role in data center operations. According to analysts, “efficient power management is crucial for capacity planning,” highlighting the increasing reliance on advanced infrastructure to meet rising workloads while maintaining energy efficiency.
An emerging trend reshaping the industry is the increased investment in High Performance Computing (HPC) systems. HPC is vital for data-intensive fields such as quantum mechanics, molecular modeling, and physical simulations. Its integration into data centers is driving demand for high-capacity, resilient power systems that can support massive computational loads. At the same time, modular and pre-fabricated data centers are gaining popularity, offering scalability and faster deployment. The market is also seeing a surge in the adoption of green and energy-efficient technologies, such as renewable energy sources and optimized cooling systems. Analysts note that “energy efficiency and managed services are becoming increasingly important” as sustainability takes center stage in data center planning and operation.
The Data Center Power Market plays a pivotal role in supporting digital infrastructure, relying heavily on core components like UPS systems, power distribution, and backup generators to ensure continuous operations. Power delivery is managed through PDU units, busway systems, and transfer switches, while critical systems such as battery backup, cooling systems, CRAC units, and chillers maintain operational stability. Technologies like economizers and power monitoring help manage energy use, and energy meters offer real-time tracking of consumption. Operational control is further enhanced with DCIM software for infrastructure management and rack PDU units for outlet-level visibility and control.
The data center power market is segmented by:
Product:
Generators
Transformers
UPS
Transfer switches and switchgears
Others
End-user:
IT and Telecom
BFSI
Energy
Healthcare
Retail
Services:
Design & Consulting
Integration & Deployment
Support & Maintenance
Among the product categories, the Generators segment is poised for significant growth during the forecast period. Valued at USD 6.89 billion in 2019, this segment has shown a steady upward trajectory and continues to expand due to its essential role in maintaining data center uptime. Generators, including gas, diesel, and bi-fuel variants, are critical for ensuring continuity during power outages, particularly in hyperscale and edge data centers. As the analyst commentary indicates, “power outages necessitate backup power supplies like generators,” especially in mission-critical environments. Their adoption is further driven by the growth in facility management strategies that prioritize energy efficiency and operational reliability.
Regions Covered:
North America
Europe
APAC
Rest of World (ROW)
North America is expected to contribute approximately 29% to the global market growth from 2025 to 2029, making it the top-performing region. This growth is powered by investments from hyperscale cloud providers, colocation service providers, and enterprises modernizing their IT infrastructure. The rise in demand for edge computing, big data analytics, and IoT services further amplifies the need for robust data center power solutions. The region is also leading in the adoption of precision air conditioning, thermal management systems, and power management software, which are crucial for high-efficiency operations. Analysts highlight that “data center design, optimization, and compliance are essential” to meet the region’s growing need for energy-efficient and scalable infrastructure.
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Despite the positive outlook, the data center power market faces a notable challenge in the form of UPS (Uninterruptible Power Supply) battery failures. These systems are critical for maintaining power continuity during outages. However, aging components and battery degradation pose serious risks. The Uptime Institute reports that power issues cause over 45% of data center outages, with potential downtime costs ranging between USD 1–5 million per hour. The average UPS battery lifespan is about ten years, underscoring the need for regular maintenance and timely replacement. Addressing this issue is vital for maintaining operational reliability and protecting data integrity, especially as facilities scale in size and complexity.
Market research highlights the adoption of advanced electrical systems like inverter systems, rectifiers, power cables, and surge protectors for efficient current conversion and protection. Tools such as voltage regulators, transformers, and energy storage solutions, including lithium-ion batteries, are gaining traction due to increasing energy demands. Alternatives like flywheel UPS and fuel cells are being explored for their reliability and sustainability. Facilities are also investing in power conditioning, harmonic filters, and grounding systems to ensure clean, stable power. Key components such as power panels, circuit breakers, and switchgear form the backbone of power distribution, while load banks aid in equipment testing and reliability assurance.
Recent research focuses on improving thermal management using technologies like air handlers, containment systems, and power analytics to optimize energy consumption. Integration with the smart grid and deployment of microgrid systems are enhancing local resilience and power control. The move toward sustainability is driving adoption of renewable energy sources, particularly through solar inverters and wind turbines, as data centers aim to reduce their carbon footprint. Efficiency initiatives also prioritize energy efficiency through design innovations and the implementation of power redundancy strategies to eliminate single points of failure and enhance system uptime.
Industry leaders are adopting strategic collaborations, product innovations, and geographic expansions to strengthen their positions in the data center power market. A notable development includes Schneider Electric’s launch of its Microdata Center, tailored for edge computing and designed to reduce operational costs and energy consumption. Similarly, Microsoft and Google’s partnership to build carbon-negative data centers demonstrates a major shift toward sustainability. Another key initiative involves Siemens Energy and Equinix, who are integrating energy storage solutions to boost grid stability and energy efficiency. These strategies align with growing trends in renewable energy integration, carbon footprint reduction, and sustainable IT infrastructure.
Key players in the market include:
ABB Ltd
Schneider Electric SE
Siemens AG
Vertiv Holdings Co.
Eaton Corp.
Cummins Inc.
Generac Holdings Inc.
Caterpillar Inc.
Toshiba Corp.
Analysts emphasize that “power solutions must evolve to support the dynamic demands of modern data centers,” noting the industry’s shift toward flexible, scalable, and energy-efficient systems.
1. Executive Summary
2. Market Landscape
3. Market Sizing
4. Historic Market Size
5. Five Forces Analysis
6. Market Segmentation
6.1 Product
6.1.1 Generators
6.1.2 Transformers
6.1.3 UPS
6.1.4 Transfer switches and switchgears
6.1.5 Others
6.2 End-user
6.2.1 IT and telecom
6.2.2 BFSI
6.2.3 Energy
6.2.4 Healthcare
6.2.5 Retail
6.3 Services
6.3.1 Design & Consulting
6.3.2 Integration & Deployment
6.3.3 Support & Maintenance
6.3.4 Design & Consulting
6.3.5 Integration & Deployment
6.3.6 Support & Maintenance
6.4 Geography
6.4.1 North America
6.4.2 APAC
6.4.3 Europe
6.4.4 South America
6.4.5 Middle East And Africa
7. Customer Landscape
8. Geographic Landscape
9. Drivers, Challenges, and Trends
10. Company Landscape
11. Company Analysis
12. Appendix
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