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Western Europe Data Center Construction Market Research Report Includes Size, Share, and Growth in Terms of
Industry Analysis Report, Regional Outlook, Growth Potential, Price Trends, Competitive Market Share & Forecast 2023–2028.
Report Attribute | Details |
---|---|
Market Size (2028) | USD 9.48 Billion |
Market Size (2022) | USD 7.24 Billion |
CAGR BY REVENUE (2022-2028) | 4.58% |
MARKET SIZE - AREA (2028) | 5.45 Million Square Feet |
POWER CAPACITY (2028) | 1,158.7 MW |
BASE YEAR | 2022 |
FORECAST YEAR | 2023-2028 |
MARKET SEGMENTS | Facility, Infrastructure, Electrical Infrastructure, Mechanical Infrastructure, Cooling Systems, Cooling Technique, General Construction, Tier Standards, and Geography |
GEOGRAPHIC ANALYSIS | UK, Germany, France, Netherlands, Ireland, Switzerland, Italy, Spain, Belgium, Portugal, Luxembourg, and Other Western European Countries |
The Western Europe data center construction market was valued at USD 7.24 billion in 2022 and is expected to reach USD 9.48 billion by 2028, growing at a CAGR of 4.58%. The region is one of the fastest-growing countries in technological development and innovation. The market is witnessing significant investments due to the increasing adoption of cloud services, the advent of AI/ML technologies, and government support for data center development. The Western Europe data center construction market is driven by factors such as land price and stability, free cooling options, carrier accessibility, accessibility of connectivity & power, and tax incentives.
The government's interest in promoting data center investments through the land for development, renewable energy procurement, and reducing electricity tariffs will drive the colocation market in Europe during the forecast period. UK, Germany, and France are among the top contributors in the Western Europe data center construction market regarding investment, area, and power capacity. The countries have the presence of some FLAP cities, such as Frankfurt and Paris, which highly attracts investments in the whole of Europe.
Growing Adoption of Artificial Intelligence
The adoption of artificial intelligence is fueling data generation and the technology market, thereby increasing the need for data center construction. Eurostat released a report according to which Ireland ranks at the top in Europe in using AI/ML technologies by businesses and enterprises in their infrastructure or applications.
Several AI initiatives in countries across the region include global partnerships on artificial intelligence, a mission on artificial intelligence, a national strategy on artificial intelligence, and others. For instance, The Government of France invested around USD 1.7 billion in its National Strategy for Artificial Intelligence. The high adoption of AI/ML solutions is prompting the installation of a highly efficient cooling infrastructure. Liquid cooling is the prominent technology for supporting AI/ML workloads in High-Performance Computing (HPC). Direct-to-chip and liquid-immersion cooling markets, through OEM, are making strong bonds. Research & Development centers are being set up for innovations in AI and other applications across various Western European countries. For instance, R&D centers for AI have been set up by companies such as Google, Oracle, and Huawei.
Increase in Sustainable Initiatives
Data centers, the major sources of carbon emissions worldwide, are looking for sustainable initiatives to reduce the high quantity of CO2 emissions generated by the facilities. According to the Europe Climate act, a part of the European Green Deal, countries across the continent are aiming to achieve net zero carbon emissions by the year 2050.
Various operators in Western Europe are a part of the Climate Neutral Data Center Pact act, such as Interxion (Digital Realty), Aruba, OVHcloud, Equinix, and Scaleway data center, among 17 industry associations. The pact states that the facilities part of it must be powered completely using energy harnessed from renewable energy sources such as wind, hydro, solar, and others by 2030. The Government of the UK aims to achieve 100% renewable energy in its energy mix by 2035.
The Government of Germany announced the Easter Package to improve the renewable energy grid deployment and expand the existing ones. By 2030, the Government of Germany will generate around 80% of renewable energy. In April 2022, AWS announced it would deploy renewable energy projects in France and other locations with 3.5 GW of power capacity. Renewable energy will be the second by AWS in France, bringing the total project capacity to around 38 MW.
Rising Colocation Data Center Investments
The Western Europe data center construction market has shown signs of growth with the development of hyperscale data centers by cloud service providers such as Microsoft, IBM, Amazon Web Services (AWS), Oracle, Google, and Tencent. The prominent investors in the Western Europe data center construction include Equinix, Interxion (Digital Realty), NTT Global Centers, Echelon Data Centres, Iron Mountain, OVHcloud, Vantage Data Centers, and VIRTUS Data Centres.
In August 2022, Proximity Data Centres opened a data center in Buckinghamshire. A loan of USD 30.8 million was granted to the operator for its UK expansion, with a total investment of USD 99 million. OVHcloud, a cloud computing, has planned to invest around USD 101 million by 2027 for its upcoming data center in Limburg. Telehouse has planned an investment of around USD 988 million for its European expansion. Telehouse plans an investment of around USD 988 million for its expansion in countries across Western Europe and other regions in Europe. An increase in data center investment will provide huge revenue opportunities for construction contractors and colocation and infrastructure providers worth billions of dollars.
Support of The Government For Data Centers
Frequently Asked Questions
How big is the Western Europe data center construction market?
The Western Europe data center construction market size was valued at USD 7.24 billion in 2022 and is expected to reach USD 9.48 billion by 2028.
What is the growth rate of the Western Europe data center construction market?
The Western Europe data center construction market share is growing at a CAGR of 4.58% from 2022-2028.
What factors drive the Western Europe data center construction market growth?
High adoption of artificial intelligence, increasing adoption of district heating systems, data centers adopting sustainability, and innovation in data center technologies drive the Western Europe data center construction market growth.
Regarding area, the Western Europe data center construction market is expected to reach 5.45 million square feet by 2028.
Who are the new entrants in the Western Europe data center construction market?
Global Technical Realty and Stratus DC Management are new entrants in the Western Europe data center construction market.
In the Western Europe data center construction market, power capacity is expected to reach 1,158.7 MW by 2028.
Western Europe data center construction market size is expected to grow at a CAGR of 4.58% from 2022 to 2028.
The following factors are likely to contribute to the growth of the Western Europe data center construction market during the forecast period:
Base Year: 2022
Forecast Year: 2023–2028
The study considers the present scenario of the Western Europe data center construction market and its market dynamics for 2023−2028. It covers a detailed overview of several market growth enablers, restraints, and trends. The report offers both the demand and supply aspects of the market. It profiles and examines leading and prominent companies operating in the market.
The report includes the investment in the following areas:
Facility
Infrastructure
Electrical Infrastructure
Mechanical Infrastructure
Cooling Systems
Cooling Techniques
General Construction
Tier Standard
Geography
Major Vendors
Prominent Support Infrastructure Providers
Prominent Construction Contractors
Prominent Data Center Investors
New Entrants
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