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Data Center Refrigerant Market - A Global and Regional Analysis: Focus on Product, Application, Supply-Chain Analysis, and Country Analysis - Analysis and Forecast, 2023-2032

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  • 153 Pages
  • March 2024
  • Region: Global
  • BIS Research
  • ID: 5945000
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The global data center refrigerant market is expected to grow from $471.2 million in 2022 to $1,215.1 million by 2032, at a CAGR of 8.59% during the forecast period 2023-2032. The growth of the global data center refrigerant market is anticipated to be fueled by the rising quantity of data centers and governmental efforts toward energy-efficient data center operations. Additionally, governmental policies and financial support encourage the utilization of environment-friendly refrigerants within data center facilities.

Market Introduction

Data center refrigerant market, with an impressive CAGR of 8.59%, demonstrates an increasing synergy between environmental sustainability and operational efficiency. Amidst the ongoing global expansion of data centers, there is a heightened demand for efficient cooling solutions. Refrigerants play a pivotal role in dissipating heat from IT infrastructure, thereby maintaining optimal functionality. In response to escalating environmental concerns, there is a notable transition towards eco-friendly refrigerants characterized by reduced global warming and ozone depletion potentials.

Notably, sectors such as IT and Telecom find extensive use of refrigerants, spurred by the escalating demand for robust and efficient cooling solutions to support the expanding digital infrastructure. This growth emphasizes the need for advanced refrigeration solutions that cater to the high-density computing environments of modern facilities.

Additionally, liquid cooling fluids are gaining traction. Integral to advanced cooling methodologies like immersion and direct-to-chip cooling, they enhance energy efficiency and minimize environmental impact in data centers. Their rising prominence reflects the industry's inclination towards solutions meeting operational demands while aligning with sustainability goals.

Adherence to government regulations, such as the Kigali Amendment to the Montreal Protocol, underscores the industry's sustainability commitment. This is crucial as organizations strive to reduce carbon footprints and optimize resource use. The transition to eco-friendly refrigerants and advanced cooling technology is pivotal, particularly in high-demand sectors like IT and Telecom, aligning with a broader move towards sustainability in modern data center operations.

Industry Impact

The industry impact of data center refrigerants is profound, influencing both environmental sustainability and operational efficiency. With the escalating number of data centers globally, the demand for efficient cooling systems is paramount. Refrigerants, crucial components in these systems, play a pivotal role in managing heat generated by critical IT infrastructure. As regulations tighten and environmental concerns escalate, there's a notable shift toward eco-friendly refrigerants with reduced global warming potential and ozone depletion potential. This transition from traditional to modern refrigerants reflects a commitment to mitigating environmental impact while optimizing energy usage. Furthermore, innovative cooling methodologies such as immersion and direct-to-chip cooling are gaining traction, promising enhanced energy efficiency and reduced carbon footprints. Thus, the industry's adoption of eco-friendly refrigerants underscores a strategic imperative toward sustainability and operational excellence in data center operations.

Market Segmentation:

Segmentation 1: by Industry

  • IT and Telecom
  • Banking
  • Financial Services and Insurance (BFSI)
  • Research and Healthcare
  • Retail
  • Manufacturing
  • Others

IT and Telecom Segment to Lead the Global Data Center Refrigerant Market (by Industry)

In the IT and telecommunications sector, Meta, Amazon, Apple, Netflix, and Google (MAANG) corporations hold significant position. These entities stand out as primary participants in corporate social responsibility (CSR) endeavors, particularly in the adoption of refrigerants with low global warming potential (GWP) within their data centers. The Banking, Financial Services, and Insurance (BFSI) sector is quickly emerging as a significant force in the data center refrigerant market, ranking as the second largest. This is due to the extensive network of large data centers operated by banking and financial institutions.

Segmentation 2: by Data Center Type

  • Hyperscale
  • Colocation
  • Edge Data Center
  • Enterprise

Hyperscale Data Centers to Lead the Global Data Center Refrigerant Market (by Data Center Type)

Hyperscale data centers are at the forefront of transforming extensive data centers into environmentally sustainable entities. They are pioneering the exploration of eco-friendly cooling techniques, with carbon dioxide (CO2) emerging as a prominent refrigerant choice. In contrast, edge data centers strategically positioned near users to minimize data processing latency typically adhere to conventional cooling methodologies. The adoption of environment-friendly refrigerants varies and is influenced by factors such as facility size and operator preferences. With sustainability gaining prominence and regulatory measures becoming more stringent, there's a potential for edge data centers to transition toward refrigerants with lower global warming potential (GWP), aligning with prevailing industry trends.

Segmentation 3: by Refrigerant Type

  • Conventional Refrigerants
  • Liquid Cooling Fluids

Liquid Cooling Fluids to Lead the Global Data Center Refrigerant Market (by Refrigerant Type)

Liquid cooling fluids are gaining traction in the data center refrigerant market due to their efficient heat dissipation properties. These fluids offer superior cooling capabilities, especially in high-density computing environments, minimizing the risk of overheating and enhancing energy efficiency. As data centers strive for sustainability and regulatory compliance, liquid cooling fluids present an eco-friendly alternative with reduced environmental impact, positioning them as a key contender in the evolving landscape of data center refrigerants.

Segmentation 4: by Cooling Type

  • Air Cooling
  • Liquid Cooling
  • Free Cooling

Air Cooling Leading the Global Data Center Refrigerant Market (by Cooling Type)

Air cooling remains a prominent choice in the data center refrigerant market, valued for its simplicity and widespread adoption. This method utilizes air as the primary cooling medium, circulating it through the data center to dissipate heat generated by IT equipment. Despite challenges such as limited scalability and energy inefficiency, air cooling remains favored in many data center setups due to its familiarity and cost-effectiveness. However, advancements in liquid cooling and environmental concerns may prompt gradual shifts toward more efficient refrigeration technologies.

Segmentation 5: by Deployment

  • Installation/OEM
  • Aftermarket

Installation/OEM to Lead the Global Data Center Refrigerant Market Market (by Deployment)

Original equipment manufacturers (OEMs) lead the data center refrigerant market. OEMs specialize in designing and manufacturing cooling systems tailored to data center specifications. With expertise in integrating refrigeration solutions seamlessly into data center infrastructure, they offer comprehensive support from initial setup to ongoing maintenance. This ensures optimal performance and reliability of refrigerant systems. As data centers increasingly prioritize efficiency and sustainability, OEMs play a pivotal role in providing innovative and eco-friendly cooling solutions tailored to evolving demand in the market.

Segmentation 6: by Region

  • North America
  • Europe
  • U.K.
  • China
  • Asia-Pacific and Japan
  • South America

North America Region to Lead the Global Data Center Refrigerant Market (by Region)

North America emerges as a frontrunner in the data center refrigerant market, driven by its robust infrastructure and technological advancements. With a high concentration of data centers across the region, including major tech hubs, North America holds a significant market share. Factors such as stringent environmental regulations and the push toward energy efficiency further propel the adoption of eco-friendly refrigerants. As the region continues to prioritize innovation and sustainability, North America remains a key influencer in shaping the trajectory of the data center refrigerant industry.

Recent Developments in the Data Center Refrigerant Market

  • In May 2022, Intel announced its commitment to invest $700.0 million in a new research and development facility focused on designing cutting-edge immersion liquid cooling solutions and other technologies tailored for data center applications.
  • In November 2022, Google announced plans for the advancement of a novel data center cooling system, which harnesses waste heat generated by servers to fuel the cooling infrastructure. This innovative system remains in its preliminary stages of development.
  • In June 2021, Microsoft inaugurated its eco-friendly datacenter region in Arizona. The Arizona-based datacenters will employ adiabatic cooling, a method that eliminates water usage for cooling during over half of the year.

Demand - Drivers and Limitations

Market Demand Drivers

The global surge in digital services, cloud computing, and data storage demands has fueled the proliferation of data center infrastructure, including hyperscale facilities deployed worldwide. Edge computing advancements have accelerated data processing for technologies such as IoT and 5G. Concurrently, environmental consciousness has prompted companies to prioritize sustainability, with giants such as Google and Microsoft committing to carbon-neutral operations. Collaborations such as BMW's partnership with EcoDC underscore this shift, leveraging green data centers for computational needs. Apple's CSR initiatives highlight the industry's progress toward carbon neutrality. To align with sustainability goals, data centers increasingly adopt energy-efficient, low-GWP refrigerants, driving market growth. As water-based cooling predominates in data centers, water usage effectiveness (WUE) emerges as a crucial metric, especially amid rising global water consumption. Combining WUE with power usage effectiveness (PUE) provides insights into facility efficiency, urging data centers to optimize water utilization for sustainable operations.

Market Restraints

Despite its promising growth trajectory, the data center refrigerant market faces several restraints. One significant challenge is the regulatory landscape, with stringent regulations and compliance requirements impacting the adoption of certain refrigerants. Additionally, the initial investment costs associated with upgrading or retrofitting existing data center cooling systems with eco-friendly refrigerants can be prohibitive for some organizations. Technical challenges, such as compatibility issues with existing infrastructure and concerns about performance and reliability, also hinder widespread adoption. Moreover, the lack of awareness and expertise in selecting and implementing suitable refrigerant solutions poses a barrier to market expansion. Addressing these restraints would be crucial for unlocking the full potential of the data center refrigerant market and driving sustainable growth in the future.

Market Opportunities

Neural network implementations are revolutionizing data center cooling by enabling real-time analysis of temperature and environmental data, leading to precise control and significant energy savings. Meanwhile, indirect thermosyphon cooling utilizes dielectric liquids to dissipate heat from electronic components efficiently. Investments in data center cooling innovations, driven by the demand for sustainability, are exemplified by initiatives such as COOLERCHIPS, aiming to reduce cooling power usage. NVIDIA Corporation received funding to develop a Green Refrigerant Compact Hybrid System, while tech giants such as Facebook and Google also invest heavily in optimizing cooling processes. Data centers' substantial energy consumption and carbon emissions underscore the urgency for sustainable practices, aligning with initiatives such as the European Green Deal for carbon-neutral data centers by 2030. Amidst the growth in data center installations driven by cloud computing and IoT, efficiency improvements in cooling are imperative to meet escalating demand while mitigating environmental impact.

How can this report add value to an organization?

Product/Innovation Strategy: In the data center refrigerant market, a strategic focus on innovation drives product development. Collaborate with industry leaders to introduce eco-friendly refrigerants and advanced cooling technologies, meeting evolving regulatory standards. Leverage data analytics for real-time monitoring, optimizing cooling efficiency, and reducing environmental impact while ensuring operational excellence.

Growth/ Marketing Strategy: Utilize targeted marketing campaigns highlighting eco-friendly benefits and energy savings. Forge partnerships with data center operators and OEMs to expand reach and offer comprehensive solutions. Continuously innovate to stay ahead in the competitive landscape.

Competitive Strategy: Emphasizing differentiation and value proposition will be crucial for success in the market. Conduct thorough market analysis to identify niche segments and competitive advantages and position products accordingly. Forge alliances with key stakeholders and offer customizable solutions to meet diverse customer needs effectively.

Key Market Players and Competition Synopsis

The companies that are profiled in the data center refrigerant market have been selected based on inputs gathered from primary experts and analyzing company coverage, product portfolio, and market penetration.

Some of the prominent names in the market are:

  • Honeywell International Inc.
  • The Chemours Company
  • Climalife
  • Arkema
  • Orbia
  • Dow
  • M&I Materials Ltd
  • Asetek, Inc. A/S
  • 3M
  • Cargill, Incorporated

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Table of Contents

Executive Summary
1 Markets
1.1 Industry Outlook
1.1.1 Market Definition
1.1.2 Data Center Trends Data Center Capacities: Current and Future Data Center Power Consumption Scenario Impact of Carbon-Neutral Data Center (CNDC) Operations on Data Center Refrigerant Market Current and Future Scenario for CNDC Alternative Solutions to Current HVAC Systems Used in Data Centers Cost Analysis Capital Expenditure (CAPEX) Infrastructure Cost Operational Expenditure (OPEX) Energy Cost Key Countries to Focus Impact of United Nations Intergovernmental Panel on Climate Change on Data Center Market Impact Assessment of United Intergovernmental Panel on Climate Change (IPCC)’s report Impact of PFAS Refrigerant Ban on the Global Data Center Cooling Outlook Alternative Cooling Solutions to PFAS Refrigerants Advantages and Disadvantages of Non-PFAS Refrigerants Data Center Cooling Strategies Upcoming Data Center Refrigerant Concepts Refrigerant Selection Criteria Other Industrial Trends HPC Cluster Developments Blockchain Initiatives Super Computing 5G and 6G Developments Impact of Server/Rack Density
1.2 Ecosystem/Ongoing Programs
1.2.1 Consortiums and Associations
1.2.2 Important Regulations
1.2.3 Government Initiatives and Impacts
1.3 Business Dynamics
1.3.1 Business Drivers Expanding Data Center Industry Data Center Investment Landscape Key Regional Data Center Investment Trend (2022-2023) Sustainable Development Efforts and CSR Activities The Green IT Cube Growing Adoption of Alternate Cooling Solutions for Improved Water Usage Efficiency Need for High Energy Efficiency
1.3.2 Business Challenges Phasing out of PFAS Refrigerants Intense Market Competition from Diverse Cooling Technology Rapid Adoption of Refrigerants over Air Cooling Driven by its Advantages Leading Hyperscale Data Centre Operators to Have a Huge Impact on Market Adoption
1.3.3 Business Opportunities AI and Neural Network Implementation to Optimize Cooling Growing Traction for Indirect Thermosyphon Cooling Increase in Investments toward Data Center Cooling Innovations Growing Utilization of Advanced Refrigerants to Meet Environmental Targets Resurgence of Air-Cooled Chillers
1.4 Supply Chain Analysis
1.5 Pricing Analysis
2 By Application
2.1 Industry
2.2 Data Center Type
3 By Product
3.1 Refrigerant Type
3.1.1 Conventional Refrigerants
3.1.2 Liquid Cooling Fluids
3.2 Cooling Type
3.2.1 Air Cooling
3.2.2 Liquid Cooling
3.2.3 Free Cooling
3.3 Deployment
3.3.1 Installation/OEM
3.3.2 Aftermarket
4 Regions
4.1 Global Data Center Outlook
4.2 North America
4.2.1 U.S.
4.2.2 Rest of North America
4.3 Europe
4.3.1 Germany
4.3.2 Netherlands
4.3.3 France
4.3.4 Scandinavia
4.3.5 Rest of Europe
4.4 U.K.
4.5 China
4.6 Asia Pacific and Japan
4.6.1 Japan
4.6.2 Australia
4.6.3 India
4.6.4 Singapore
4.6.5 Rest of Asia Pacific
4.7 South America
4.7.1 Brazil
5 Markets - Competitive Benchmarking & Company Profiles
5.1 Competitive Benchmarking
5.2 Company Profiles
5.2.1 Honeywell International Inc. Company Overview Product Portfolio Analyst View Regions of Growth:
5.2.2 The Chemours Company Company Overview Product Portfolio Analyst View Regions of Growth:
5.2.3 Climalife Company Overview Product Portfolio Analyst View Regions of Growth:
5.2.4 Arkema Company Overview Product Portfolio Analyst View Regions of Growth:
5.2.5 Orbia Company Overview Product Portfolio Analyst View Regions of Growth:
5.2.6 DAIKIN INDUSTRIES, Ltd. Company Overview Product Portfolio Customer Profile Target Customer Segments Key Clients Analyst View Regions of Growth:
5.2.7 Dow Company Overview Product Portfolio Customer Profile Target Customer Segments Analyst View Regions of Growth:
5.2.8 M&I Materials Ltd Company Overview Product Portfolio Customer Profile Target Customer Segments Analyst View Regions of Growth:
5.2.9 Asetek, Inc. A/S Company Overview Product Portfolio Customer Profile Target Customer Segments Analyst View Regions of Growth:
5.2.10 3M Company Overview Product Portfolio Customer Profile Target Customer Segments Key Clients Analyst View Regions of Growth:
5.2.11 Cargill, Incorporated Company Overview Product Portfolio Customer Profile Target Customer Segments Analyst View Regions of Growth:
6 Research Methodology
6.1 Data Sources
6.1.1 Primary Data Sources
6.1.2 Secondary Data Sources
6.1.3 Data Triangulation
6.2 Market Estimation and Forecast
6.2.1 Factors for Data Prediction and Modelling
List of Figures
Figure 1: Properties of Hydrogen, Fluorine, and Chlorine Refrigerants
Figure 2: Phase-Out Schedules for HCFCs and HFCs
Figure 3: Global Data Center Refrigerant Market, $Million, 2022-2032
Figure 4: Global Data Center Refrigerant Market (by Industry), $Million, 2022 and 2032
Figure 5: Global Data Center Refrigerant Market (by Data Center Type), $Million, 2022 and 2032
Figure 6: Global Data Center Refrigerant Market (by Refrigerant Type), $Million, 2022 and 2032
Figure 7: Global Data Center Refrigerant Market (by Cooling Type), $Million, 2022 and 2032
Figure 8: Global Data Center Refrigerant Market (by Deployment), $Million, 2022 and 2032
Figure 9: Global Data Center Refrigerant Market (by Region), 2022
Figure 10: Scope Definition
Figure 11: Hyperscale Data Center Capacity (by Region), MW, 2021
Figure 12: Data Center Capacity Outlook (by Region), MW, 2021
Figure 13: Anticipated Energy Consumption, by Data Center Types, TWh, 2023
Figure 14: Power Flows in a typical Data Center:
Figure 15: Pathway to Carbon Neutrality in Data Centers
Figure 16: Key Factors for Assessing Infrastructure Cost in a Data Center Project
Figure 17: CAPEX Comparison: Traditional Data Centers (TDC) Vs Carbon Neutral Data Centers (CNDC)
Figure 18: Key Factors for Assessing Energy Cost in Data Center Project
Figure 19: OPEX Comparison: Traditional Data Centers (TDC) Vs Carbon Neutral Data Centers (CNDC):
Figure 20: Major Countries’ Share of Total Installed Renewable Capacity, 2021
Figure 21: Global Trend in Industrial Refrigeration
Figure 22: Estimated Capital Expense for Various Data Center Cooling Technologies
Figure 23: Some Criteria Followed by Data Centers while Choosing Refrigerants
Figure 24: GWP and ODP of Most Common Refrigerants in Data Centers
Figure 25: Estimated Worldwide 5G Adoption as a Share of Total Mobile Connections (Excluding IoT)
Figure 26: Share of Global Data Center (by Country), 2022
Figure 27: Water Utility and Wastewater Cost Comparison in Data Centers, 2021
Figure 28: Cooling Efficiency and Water Usage of Data Center Cooling Technologies
Figure 29: Energy Distribution in a Typical Data Center, 2022
Figure 30: Evolution of Refrigerants from 1830 and Future Anticipations
Figure 31: Data Center Web Traffic, Zettabytes per Year, 2016-2021
Figure 32: Data Center pPue Analysis
Figure 33: Supply Chain Analysis of Global Data Center Refrigerant Market
Figure 34: Competitive Benchmarking Matrix
Figure 35: Global Data Center Refrigerant Market: Research Methodology
Figure 36: Data Triangulation
Figure 37: Top-Down and Bottom-Up Approach
Figure 38: Assumptions and Limitations
List of Tables
Table 1: Advantages and Disadvantages of Non-PFAS Refrigerants
Table 2: Key Consortium/Association in Data Center Refrigerant Industry
Table 3: Regulations Impacting the Data Center Refrigerant Market
Table 4: Government Initiatives and Impacts
Table 5: Recent Developments by Leading Companies toward Data Center Cooling, 2019-2023
Table 6: Key Companies and Developments toward Neural Networks in Data Centers
Table 7: Key Companies Exploring Indirect Thermosyphon Cooling
Table 8: Data Center Refrigerant Pricing
Table 9: Global Data Center Refrigerant Market (by Region), $Million, 2022-2032
Table 10: Honeywell International Inc.: Product Portfolio
Table 11: The Chemours Company: Product Portfolio
Table 12: Climalife: Product Portfolio
Table 13: Arkema: Product Portfolio
Table 14: Orbia: Product Portfolio
Table 15: DAIKIN INDUSTRIES, Ltd.: Product Portfolio
Table 16: Dow: Product Portfolio
Table 17: M&I Materials Ltd: Product Portfolio
Table 18: Asetek, Inc. A/S: Product Portfolio
Table 19: 3M: Product Portfolio
Table 20: Cargill, Incorporated: Product Portfolio

Companies Mentioned

  • Honeywell International Inc.
  • The Chemours Company
  • Climalife
  • Arkema
  • Orbia
  • Dow
  • M&I Materials Ltd
  • Asetek, Inc. A/S
  • 3M
  • Cargill, Incorporated

Table Information