U.S. Data Center Power Market Size & Share Analysis, Growth Trends (2026–2031)

U.S. DATA CENTER POWER MARKET LANDSCAPE

The U.S. data center power market size witnessed investments of USD 27.79 billion in 2025 and will witness investments of USD 50.96 billion by 2031, growing at a CAGR of 10.63% during the forecast period. market is expanding as facilities scale up to support growing digital workloads and higher electricity demands. The rapid adoption of cloud computing, artificial intelligence (AI), and High-Performance Computing (HPC) is increasing the need for reliable, uninterrupted power supply and resilient electrical infrastructure. This is driving demand for UPS systems, generators, switchgear, transfer switches, PDUs, transformers, and other power distribution equipment, creating growth opportunities for electrical infrastructure providers.

The expansion of hyperscale and colocation data centers across the U.S. is driving demand for electrical infrastructure to support growing power requirements. For instance, Vantage Data Centers’ Frontier campus in Texas is planned to support approximately 1.4 GW of capacity, highlighting the scale of power infrastructure required for next-generation data center developments. These projects are increasing demand for UPS systems, generators, switchgear, transfer switches, PDUs, transformers, and other electrical distribution equipment.

Sustainability targets, grid capacity limitations, and rising AI-related electricity demand are driving U.S. data center operators to explore alternative backup and on-site power solutions. Technologies such as fuel cells, HVO-powered generators, natural-gas generation, battery energy storage systems (BESS), and nuclear power are gaining attention for their potential to support reliable power supply while addressing emissions and capacity requirements.

U.S. DATA CENTER POWER MARKET INSIGHTS BY POWER CAPACITY

The US data center power market by power capacity is expected to reach 13,565 MW by 2031. The market is expanding as hyperscale cloud deployments, AI workloads, and increasing data center power density drive higher electricity consumption. The U.S. Energy Information Administration (EIA) projects electricity consumption to rise to 4,391 billion kWh in 2027. This growth is increasing demand for UPS systems, generators, transfer switches, switchgear, PDUs, transformers, busways, and associated monitoring and protection systems to support reliable power delivery.

The shift toward AI/HPC workloads is moving data centers from conventional rack densities to environments with significantly higher densities. This is increasing the demand for high-capacity UPS systems, higher-rated PDUs, busways, switchgear, transformers, and power distribution architectures capable of supporting rapidly changing loads.

Investment in dedicated power capacity is increasing as operators seek to support large-scale AI and hyperscale developments across major U.S. data center markets. In August 2026, Prometheus Hyperscale partnered with Istmo Energy to develop a Texas AI data center campus with up to 2.5 GW of planned capacity, including 1.5 GW in the first phase, supported by behind-the-meter natural gas and ethane generation.

KEY TAKEAWAYS

1. Electrical Infrastructure: The UPS systems accounted for the largest market share of around 28% in 2025.
2. UPS System Capacity: The UPS systems of ≤500 kVA dominated and held the largest market share in 2025.
3. Generator Capacity: The high-capacity generators (≥3 MW) dominated the U.S. data center power market in 2025, accounting for over 55% of the market share.
4. Generator Type: The diesel and natural gas generators accounted for the largest market share in 2025.
5. Tier Standards: The Tier IV segment dominated the U.S. data center power market in 2025.

Recent Developments & News in U.S. Data Center Power Market

1. In May 2026, TeraWulf selected Schneider Electric for more than $290 million in infrastructure at its Lake Mariner campus in New York, including Galaxy VX UPS systems and lithium-ion battery systems to support high-density AI and HPC workloads, demonstrating the growing deployment of high-capacity backup power infrastructure for AI data centers.
2. Vantage Data Centers is investing nearly $3 billion to develop its 224MW NV1 AI-focused campus in Storey County, Nevada, comprising four data centers with more than 1 million square feet of capacity. The campus will support high-density AI workloads of up to 720W/square feet, driving the demand for high-capacity electrical distribution, UPS, switchgear, and other power infrastructure.
3. In August 2026, OpenAI announced plans for an 8GW AI data center in central Ohio, developed by SB Energy and supported by 10GW in new power generation. The project, backed partly by an Nvidia financial guarantee, is expected to begin bringing initial capacity online in 2028, highlighting the rapidly increasing scale of investment in AI data centers and the associated demand for large-scale power infrastructure.
4. In October 2025, Aligned Data Centers partnered with Calibrant Energy to deploy a 31MW/62MWh BESS at a data center campus in the US. The on-site battery system is intended to help the facility come online and scale faster by reducing the dependence on traditional utility upgrades.

U.S. DATA CENTER POWER MARKET KEY TRENDS

AI-driven Power Density Growth

Rising AI workloads are increasing power consumption per data center rack, as GPU- and accelerator-based servers require substantially more electricity than conventional computing systems. Consequently, rack power densities are shifting from traditional levels of 10–20 kW to 40–100 kW or higher in AI-focused deployments, driving demand for high-capacity UPS systems, PDUs, busways, switchgear, and other electrical distribution infrastructure capable of supporting these increased loads.

Electrical infrastructure vendors are expanding their product portfolios to accommodate rising AI rack densities, with a growing focus on high-capacity, modular, and scalable power solutions capable of supporting rack loads exceeding 100 kW. This shift is driving the development of advanced UPS systems and power distribution architectures designed to meet the evolving power requirements of AI-driven data centers.

In June 2026, Vertiv launched its “Extreme” rack for AI and HPC data centers, designed to handle the higher mechanical and power requirements of next-generation AI servers. The rack provides up to 2× higher dynamic capacity and 1.3× higher static capacity, highlighting how electrical and physical infrastructure vendors are adapting their product portfolios to support increasing AI rack densities.

Increasing Adoption of Next-generation UPS Battery Systems

The U.S. data center power market is witnessing increased adoption of next-generation UPS battery systems as operators seek to improve backup reliability, energy efficiency, and space utilization amid rising power demands from AI and high-density computing workloads. Lithium-ion batteries are gaining traction as an alternative to conventional lead-acid batteries due to their longer service life, faster charging, smaller footprint, and lower maintenance requirements.

Eaton’s EnergyAware UPS technology, developed with Microsoft, enables lithium-ion UPS systems in data centers to operate as distributed energy resources, allowing operators to provide grid services such as frequency regulation and peak shaving while maintaining backup power.

Equinix has invested in installing sodium-ion batteries in its DC15 data center in Ashburn, Washington, to enhance sustainability in the data center, while minimizing environmental impact and greenhouse gas emissions.

U.S. DATA CENTER POWER MARKET DRIVERS

Rapid Expansion of AI and Hyperscale Data Centers

U.S. hyperscalers and technology companies are increasingly developing large-scale, purpose-built AI campuses designed to accommodate GPU clusters, high-density racks, and advanced cooling systems. With power requirements reaching hundreds of megawatts per campus, these developments are driving demand for high-capacity transformers, switchgear, UPS systems, generators, and power distribution equipment to ensure reliable and scalable power delivery.

AI demand is driving the development of larger hyperscale campuses. In June 2026, Applied Digital announced a $5.2 billion, 15-year lease agreement with a hyperscale customer in the US for 210MW of capacity at its Delta Forge 2 AI campus, reflecting the industry's shift toward multi-hundred-megawatt AI-focused data center developments.

Growing Demand for Sustainable Backup Power

Rising data center power demand, grid capacity constraints, and growing pressure to reduce emissions are encouraging U.S. operators to explore alternative and lower-emission power solutions. Fuel cells, HVO-powered generators, natural-gas generation, and emerging nuclear technologies are gaining attention for backup and on-site power supply, driving demand for supporting electrical infrastructure, including transformers, switchgear, UPS systems, power-conversion equipment, and control systems.

U.S. data center operators are increasingly adopting Hydrotreated Vegetable Oil (HVO) as a lower-carbon alternative to diesel for backup generators. For instance, Compass Datacenters has deployed HVO at selected facilities, helping reduce emissions while utilizing compatible existing generator infrastructure.

In April 2025, Apple announced an investment worth $175 million to expand its data center campus in Maiden, North Carolina, adding approximately 237,600 square feet of area. The existing campus is fully powered by renewable energy, including biogas fuel cells from Bloom Energy, solar generation, and clean-energy purchases.

U.S. DATA CENTER POWER MARKET RESTRAINTS

Supply Chain and Manufacturing Constraints

U.S. data center operators face supply chain constraints due to AI-driven demand, geopolitical tensions, and shortages of critical equipment, including transformers, switchgear, and backup generators. Power transformer lead times have exceeded 160 weeks, forcing utilities and data center developers to place orders years in advance. These delays can postpone facility launches and increase capital and operating costs.

Data center operators are mitigating supply chain risks by pre-ordering long-lead equipment, diversifying supplier networks, and establishing strategic procurement agreements to secure critical components such as transformers, switchgear, UPS systems, and generators.

High Capital Costs

High upfront costs remain a key restraint on the U.S. data center power market, as developing power generation facilities, transmission networks, grid modernization projects, and energy storage systems requires substantial investment. Rising interest rates, construction cost inflation, and lengthy permitting processes further increase project expenses, potentially delaying infrastructure development and limiting the timely expansion of power capacity to meet growing AI-driven data center demand.

The development costs for modern US data centers increased by over 20-25% per MW, driven by rising equipment, labor, and material costs. Average greenfield costs reached around $15-20 million per MW, increasing the capital required for new facilities and their electrical infrastructure.

U.S. DATA CENTER POWER MARKET SEGMENTATION INSIGHTS

INSIGHTS BY ELECTRICAL INFRASTRUCTURE

The U.S. data center power market by electrical infrastructure is segmented into UPS systems, generators, transfer switches & switchgears, PDUs, and other electrical infrastructure. The UPS systems accounted for the largest market share of around 28% in 2025. Rising power demand from hyperscale cloud facilities, AI workloads, and high-performance computing is creating opportunities for UPS manufacturers and suppliers. Increasing rack power densities and the development of large-scale data center campuses are driving investment in UPS systems, generators, transformers, switchgear, and power distribution equipment. Grid capacity constraints and the need for uninterrupted power are further encouraging operators to strengthen on-site power generation and backup infrastructure.

Data center operators are increasingly adopting lithium-ion and grid-interactive UPS systems to improve energy efficiency, extend battery life, and support high-density AI workloads while enhancing grid resilience. This shift is creating opportunities for suppliers offering advanced, energy-efficient power backup solutions designed for next-generation data centers.

For instance, Aligned Data Centers’ PDX-01 facility incorporates advanced UPS infrastructure integrated with a Battery Energy Storage System (BESS) and an N+1 redundant architecture. This highlights the growing focus on power resilience and energy management in AI-ready facilities. Companies supplying UPS and related power infrastructure should assess this segment for growth opportunities and refer to the market report for insights into demand trends, technology adoption, competitive developments, and investment opportunities.

INSIGHTS BY UPS SYSTEM CAPACITY

The UPS systems of ≤500 kVA dominated and held the largest U.S. data center power market share in 2025. Demand from enterprise and colocation facilities continues to support this segment, creating opportunities for UPS manufacturers and suppliers serving smaller and mid-sized data center applications. At the same time, rising AI workloads and higher rack power densities are encouraging operators to evaluate higher-capacity UPS solutions as their power requirements increase.

UPS systems rated at 500 kVA or below are widely used in smaller data centers, IT rooms, edge facilities, and individual equipment zones. These systems provide reliable backup power and scalable capacity for facilities with moderate power requirements, making them an important solution for enterprise operators and smaller colocation providers.

As IT loads and rack densities increase, operators may need to upgrade existing systems or adopt higher-capacity solutions. UPS manufacturers should assess demand across enterprise, edge, and colocation facilities to identify sales opportunities and align their product portfolios with changing power requirements. The U.S. data center power market report can help companies evaluate segment demand, capacity trends, technology adoption, and competitive opportunities to support business planning.

INSIGHTS BY GENERATOR CAPACITY

Based on generator capacity, high-capacity generators (≥3 MW) dominated the U.S. data center power market in 2025, accounting for over 55% of the market share. Rising power requirements from hyperscale and AI-focused data centers are driving demand for these systems, creating opportunities for generator manufacturers and power infrastructure suppliers. The need for reliable backup power and uninterrupted operations during grid outages is further encouraging data center operators to invest in large-capacity generator systems.

High-capacity generators also provide the scalability required to support future increases in IT loads without major changes to existing backup power infrastructure. As operators expand facilities and deploy higher-density AI workloads, suppliers offering reliable, scalable generator solutions can target growing procurement demand across hyperscale and colocation projects.

For instance, Equinix’s NY11 IBX data center in New Jersey is equipped with four 3.5 MW diesel generators, N+1 redundancy, and 30 hours of fuel storage. This highlights the importance of high-capacity backup power in maintaining data center operations. Companies supplying large generator systems should assess the U.S. data center power market report for insights into capacity demand, infrastructure investments, technology trends, and competitive opportunities to guide sales and expansion strategies.

INSIGHTS BY GENERATOR TYPE

Based on generator type, diesel and natural gas generators accounted for the largest share of the U.S. data center power market in 2025, supported by their reliability, rapid start-up, and established use in backup power systems. The continued expansion of data centers and rising power requirements are creating opportunities for generator manufacturers and power infrastructure suppliers serving this segment.

Diesel and natural gas generators provide critical backup power during grid outages, helping data center operators maintain continuous operations. Diesel generators remain widely adopted because of their high power output and established infrastructure, while natural gas generators are gaining interest as operators seek lower-emission alternatives and more readily available on-site power generation options.

As data center operators expand capacity and strengthen power resilience, suppliers should assess demand for both diesel and natural gas generator systems. The U.S. data center power market report can help companies evaluate generator demand, technology adoption, infrastructure investment, and competitive opportunities to support sales planning and business expansion.

INSIGHTS BY TIER STANDARDS

Based on tier standards, the Tier IV segment dominated the U.S. data center power market in 2025, driven by demand for high availability, fault tolerance, and reliable power infrastructure. Tier IV data centers require at least 2N+1 redundancy across power and cooling systems and target 99.995% availability. Some facilities adopt additional redundancy, including 2N+2 configurations for components such as UPS systems and power distribution units (PDUs). The growing adoption of AI and high-density computing is further increasing the need for reliable power infrastructure, creating opportunities for suppliers of backup generators, UPS systems, and power distribution equipment.

Power constraints, rising rack densities, and the need to minimize downtime are encouraging data center operators to invest in resilient and redundant power systems. According to the Uptime Institute, around 16 Tier IV data centers are located across Texas, New Jersey, and Nevada. This creates opportunities for power infrastructure suppliers serving hyperscale, cloud, and mission-critical facilities. Companies targeting this segment should refer to the U.S. data center power market report for insights into tier-level demand, redundancy requirements, infrastructure investments, and competitive opportunities to support sales and expansion strategies.

U.S. DATA CENTER POWER MARKET VENDOR LANDSCAPE

The U.S. data center power market is characterized by the presence of major electrical infrastructure manufacturers and power solution providers, including ABB, Aggreko, Aksa Power Generation, AMETEK Powervar, ATEN, Caterpillar, Cummins, Delta Electronics, Eaton, Enlogic, EticaAG, EverExceed Industrial, Exide Technologies, Flex, FlexGen, Fuji Electric, Hammond Power Solutions, Legrand, Piller Power Systems, Plug Power, Powell Industries, Powertek, Pramac, Raritan, Rolls-Royce, Schneider Electric, Siemens, Vertiv and many more.

These companies supply a broad range of solutions, including UPS systems, generators, transformers, switchgear, power distribution units, and fuel cell technologies. Growing investment in hyperscale campuses, AI-focused data centers, and colocation facilities is driving demand for high-capacity power equipment, reliable backup systems, and scalable electrical infrastructure to address rising power densities and grid constraints across the U.S. market.