Data Center Cooling Market Projected to Reach $100.12 Billion by 2035 – BIS Research

Market Overview: 

Market Size and Growth Rate: 

The market is projected to grow from $25.77 billion in 2024 to $100.12 billion by 2035, registering a CAGR of 12.55% during the forecast period. 

Trends & Innovation: 

Innovation in liquid-based cooling techniques, such as direct-to-chip and immersion cooling, is accelerating due to their higher efficiency compared to traditional air-based methods. The adoption of AI-powered cooling management, machine learning for real-time optimization, and integration with renewable energy are also reshaping the landscape. Further, green building certifications and data center sustainability mandates are fostering eco-friendly cooling designs. 

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Key Highlights: 

Report USP: 

• Detailed market forecast and CAGR projections up to 2035 
• Evaluation of emerging cooling technologies and deployment strategies 
• Analysis of regulatory impacts and environmental sustainability trends 
• Strategic benchmarking of leading players and their innovation roadmaps 

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Demand Drivers, Challenges & Opportunity 

Market Drivers 

The rising demand for data processing and storage is fueling the adoption of energy-efficient data center cooling technologies. Solutions such as AI-enabled cooling, liquid-based systems, and free cooling are gaining traction for their ability to reduce costs, energy consumption, and carbon footprints. Growing industry focus on metrics like Power Usage Effectiveness (PUE) and Water Usage Effectiveness (WUE) is also pushing companies to invest in sustainable, resilient, and cost-effective cooling infrastructures. 

Market Restraints 

Despite technological progress, the adoption of advanced data center cooling systems is hampered by high upfront costs and integration challenges. Immersion and free cooling methods often require major retrofitting, specialized infrastructure, and technical expertise. Concerns such as system reliability, risks of leakage or microbial growth, and ongoing maintenance further deter businesses. Air cooling remains dominant but inefficient, facing issues like noise, energy waste, and escalating operational costs that limit innovation uptake. 

Market Opportunities 

The market offers robust growth opportunities through retrofitting existing data centers with advanced cooling systems and optimizing energy management. Adoption of liquid immersion cooling and DCIM (Data Center Infrastructure Management) software is increasing, enabling greater energy efficiency and operational insights. Moreover, the surge in edge data centers driven by 5G rollout and digital transformation demands compact, efficient cooling solutions. These evolving trends create strong incentives for vendors to innovate and expand their cooling offerings. 

Market Segmentation 

Segmentation 1: End-Use Industry based  segmentation 

•    IT and Telecom 

•    Healthcare 

•    Retail 

•    Banking, Financial Services, and Insurance 

•    Government and Public Sector 

•    Manufacturing 

•    Others 

Segmentation 2: Data Center Type based  segmentation 

•    Centralized Data Center 

        o    Hyperscale 

        o    Colocation 

        o    Enterprise 

•    Edge Data Center 

Segmentation 3: Application Area based  segmentation 

•    Artificial Intelligence (AI) 

•    High-Performance Computing (HPC) 

•    Cloud Computing 

•    Edge Computing 

•    Others 

Segmentation 4: Solution based  segmentation 

•    Air Cooling 

        o    Air Conditioner 

        o    Air Handling Unit 

        o    Chiller 

        o    Cooling Tower 

        o    Economizer System 

        o    Others 

•    Liquid Cooling 

        o    Direct 

        o    Rear Door Heat Exchangers (RDHX) 

•    Free Cooling 

Segmentation 5: Rack Density based  segmentation 

•    Low Rack Density (1-4 kW) 

•    Medium Rack Density (5-9 kW) 

•    High Rack Density (Above 9 kW) 

Segmentation 6: Region based  segmentation 

•    North America 

•    Europe 

•    Asia-Pacific 

•    Rest-of-the-World 

Competitive Landscape: 

Key Players: 

•    Vertiv Group Corp. 

•    Schneider Electric 

•    Asetek, Inc. 

•    Submer 

•    Munters 

•    ZutaCore, Inc. 

•    Coolcentric (Heico Companies LLC) 

•    Midas Immersion Cooling 

•    PEZY Computing K.K. 

•    ALFA LAVAL 

•    Condair Group 

•    Fujitsu 

•    Danfoss 

•    Modine Manufacturing Company 

•    Boyd 

•    Johnson Controls International plc 

•    Carrier 

•    STLUZ GMBH 

•    LiquidStack Holding B.V. 

•    JETCOOL Technologies Inc (Flex Ltd.) 

•    Chilldyne, Inc. 

•    Accelsius LLC 

•    CoolIT Systems 

•    DCX Liquid Cooling Systems  

•    nVent 

•    Rittal GmbH & Co. KG 

Strategic Initiatives: 

Key players are investing in AI-enabled cooling platforms, forming partnerships with hyperscale cloud providers, and acquiring regional cooling solution providers to expand their footprint. Many have committed to carbon neutrality goals, pushing innovations in low-GWP refrigerants and free-cooling systems to align with environmental standards. 

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Case Studies & Success Story: 

One notable example includes the implementation of AI-optimized liquid cooling at a hyperscale data center in Europe, which led to a 40% reduction in energy usage for cooling and extended server lifespans. Another success case in Asia involved retrofitting an older data center with immersion cooling, cutting operational costs by over 30% annually. These stories reflect the tangible ROI and sustainability gains achieved through next-gen cooling solutions. 

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