HVO for Data Center Backup Market Set to Reach $38.16 Million by 2034 – BIS Research

What Is the HVO for Data Center Backup Market Outlook? 

The HVO (Hydrotreated Vegetable Oil) for data center backup market is gaining traction as a green alternative to conventional diesel generators. With mounting pressure on data centers to reduce their carbon footprint, HVO offers a cleaner-burning, drop-in replacement that supports net-zero initiatives without compromising reliability. It is especially appealing for hyperscale and colocation operators aiming for ESG compliance. 

How Fast Is the HVO for Data Center Backup Market Growing? 

According to BIS Research, the HVO for data center backup market was valued at $11,694.6 thousand in 2024 and is projected to reach $38,161.6 thousand by 2034, growing at a CAGR of 10.51% over the forecast period (2025–2034). The robust growth reflects increased adoption across Europe and North America, where renewable diesel mandates and clean energy standards are evolving rapidly. 

What New Technologies Are Reshaping the HVO for Data Center Backup Market? 

The market is being reshaped by innovations in generator engine design optimized for HVO, real-time fuel performance monitoring systems, and hybrid setups combining HVO with battery storage. Vendors are also developing modular HVO storage solutions to streamline retrofits for existing diesel gensets, reducing cost and complexity for operators. 

How Will This Report Help You? 

• Are you evaluating new market entry or regional expansion strategies? 

The report provides region-specific adoption trends, infrastructure readiness, and regulatory drivers to identify high-growth markets. 

• Do you want to benchmark your sustainability roadmap against top players? 

Learn how leading companies like Neste and TotalEnergies are scaling HVO adoption in partnership with hyperscale data center operators. 

• Are you planning product or fuel supply chain innovation? 

Discover gaps in generator compatibility, HVO distribution, and hybrid solutions that offer opportunities for technology and logistics providers. 

• Do you need to support ESG reporting and decarbonization targets? 

Use market data and emissions comparisons to justify investments in renewable diesel over traditional fuels for backup power. 

• Are you preparing an investment case or stakeholder presentation? 

Access data-backed forecasts, competitive landscape analysis, and fuel transition success stories to inform strategic planning and pitch decks. 

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Demand Drivers, Challenges & Opportunities – What Factors Are Shaping the HVO Market? 

Drivers: 

• Carbon Reduction Targets: HVO emits up to 90% fewer lifecycle greenhouse gases than fossil diesel. 
• Policy Support: Incentives in Europe and North America promote the use of renewable fuels in critical infrastructure. 
• Operational Reliability: HVO maintains performance at par with fossil diesel, ensuring uptime. 

Challenges: 

• Higher Fuel Cost: HVO can be more expensive than traditional diesel in regions with limited supply. 
• Limited Availability: Infrastructure for HVO distribution is still under development in many countries. 

Opportunities: 

• Retrofit Potential: Existing diesel generator systems can be easily adapted to run on HVO. 
• Global Sustainability Mandates: Growing interest in green colocation services boosts market demand. 

How Is the Market Segmented? 

Segmentation 1: by Data Center Type 

•    Colocation and Retail 

•    Hyperscale Data Center 

•    Others 

Segmentation 2: by Data Center Type 

•    Edible Vegetable Oils 

•    Crude Palm Oil 

•    Used Cooking Oil 

•    Tall Oil 

•    Animal Fats 

•    Others 

        o    Non-Edible Vegetable Oil 

        o    Sludge Palm Oil Mill Effluent 

        o    Others 

Segmentation 3: by Technology Type 

•    Standalone Hydrotreating Technology 

•    Co-Processing Technology 

Segmentation 4: by Region 

•    North America 

•    Europe 

•    Asia-Pacific 

•    Rest-of-the-World 

Who Are the Leaders in the HVO for Data Center Backup Market? 

Key players include: 

•    HVO Manufacturers 

        o    Neste 

        o    Rapsol 

        o    TotalEnergies 

        o    Phillips 66 

        o    ENI S.p.A. 

•    HVO Suppliers 

        o    Crown Oil 

        o    Foster Fuels 

        o    Certas Energy 

        o    LubiQ HVO Fuels 

•    HVO Generator Manufacturers 

        o    Kohler 

        o    Rolls Royce 

        o    CUMMINS 

        o    Catterpillar 

        o    Baudouin 

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Strategic Initiatives – What Moves Are Shaping the Future? 

Strategic initiatives are actively shaping the future of the HVO (Hydrotreated Vegetable Oil) market for data center backup. Leading energy players like Neste and TotalEnergies are significantly expanding their global production capacities to meet rising demand. Simultaneously, OEM collaborations are gaining momentum, with partnerships being formed between HVO producers and generator manufacturers to ensure technical compatibility and seamless integration. Moreover, companies such as Shell and Preem AB are engaging in strategic alliances with hyperscale data center operators across Europe, piloting HVO-based backup solutions that align with sustainability goals and carbon reduction targets. These coordinated moves reflect a broader industry shift toward low-emission alternatives in critical infrastructure. 

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Here Are Some Case Studies and Success Stories in the HVO for Data Center Backup Market: 

Several data centers globally have successfully adopted Hydrotreated Vegetable Oil (HVO) for backup power, showcasing its viability as a sustainable diesel alternative. EcoDataCenter in Sweden partnered with Rolls-Royce to run mtu generators on HVO, achieving a 95% CO₂ reduction with no engine modifications. In the UK, Kao Data became the first operator to fully switch to HVO, cutting emissions by nearly 90%. Compass Datacenters in the U.S. reported an 85% GHG reduction during HVO trials across multiple sites. A Dutch colocation center using HVO-powered mtu units saved over €800,000 and reduced CO₂ by 90% in five years. In Brazil, Scala Data Centers confirmed HVO’s technical feasibility in Caterpillar generators but paused full adoption due to high fuel costs, pending better economic conditions. These cases highlight HVO’s effectiveness in enhancing sustainability without compromising reliability. 

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Related Reports from BIS Research 

Europe Data Center Colocation Market 

Asia-Pacific Edge Data Center Market 

Data Center Cooling Market 

About BIS Research 

BIS Research is a global B2B market intelligence and advisory firm focusing on deep technology and related emerging trends, which can disrupt the market dynamics in the near future. We publish over 200 market intelligence studies annually, focusing on several deep technology verticals.   

Our strategic market analysis emphasizes market estimations, technology analysis, emerging high-growth applications, deeply segmented granular country-level market data, and other important market parameters useful in the strategic decision-making for senior management.    

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