Hyperscale Migration to Liquid Cooling to Boost APAC Data Center Cooling Market to USD 3.37 Billion Investment in 2027.


According to Arizton’s latest research report, the Asia-Pacific data center cooling market will grow at a CAGR of 6.8% from 2021-2027. The Asia Pacific data center cooling market is driven by the adoption of the 5G technologies such as IoT, big data, AL & ML, and digitalization. The facilities in the region have started adopting liquid immersion cooling technologies. For instance, OneAsia announced to launch first liquid immersion cooling system in its Hong Kong data centers. Further, free cooling techniques will continue to dominate the market for evaporative coolers, free cooling chillers, air-side economizers, and water-side economizers in Japan, Australia, New Zealand, South Korea, and Northern China.

China leads the Asia Pacific data center cooling market and is expected to grow at a CAGR of 5.07% during the forecast period. In China, investments are led by internet, cloud, and telecommunication service providers. Alibaba, China Unicom, China Telecom, Baidu, Tencent, and China Mobile are leading companies in the region. In China, smart cities are also being developed so that regional investments will rise. For instance, Alibaba, a cloud service provider, has developed a smart city in Hangzhou called City Brain. The smart city was designed to improve the economy, environment, and energy consumption and monitor traffic congestion. The use of AI has helped it reduce traffic by 15%. In China, most facilities are designed to cool servers using water-based cooling techniques. The growing construction of facilities will propel the adoption of developed multiple chillers, cooling towers, and CRAH units in the country.

In Singapore, increased deployment of AI and ML workloads will increase liquid-immersion and direct-to-chip cooling. Data centers with a deployed rack power density of over 20–30 kW will use direct-to-chip cooling. Apart from cryptocurrency and scientific research, even complex artificial intelligence and machine learning applications are increasingly requiring direct-to-chip and liquid immersion cooling in data centers. Vendors have also started innovations in design and technology used by the cooling systems they are offering. The market for direct liquid cooling and immersion cooling solutions is expected to become more competitive with the growing adoption of HPC infrastructure for AI and ML workloads among data centers. Initiatives such as Open Commute Projects are expected to bring several new cooling techniques and technologies to the market, thereby creating more competition among vendors. Datacenter operators are on the lookout for vendors providing systems with real-time monitoring and management solutions.

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Adoption of Innovative Cooling Technologies 

  • In June 2022, Subsea Cloud, a US-based firm, announced the proposal for the deployment of underwater data center pods across the shores of Singapore. In addition, In January 2022, Highlander signed an agreement to develop the world’s first commercial underwater data center on Hainan Island, China. This facility aims to reduce the cost of cooling and carbon emission. 
  • In 2015, Microsoft tested its underwater data center operations. After initial success, phase 1 of the project enabled Microsoft’s data center operations to record a PUE of 1.07. In 2018, Microsoft pilot-tested a large deployment underwater at the European Marine Energy Centre in Scotland. This facility is powered by nearby marine renewable energy sources and uses AI-based monitoring systems. The success of this pilot project will enable Microsoft to stop constructing large facilities on land and drop facilities into the ocean. In 2020, Microsoft's final stage was retrieval and revealed that the underwater data center system is reliable and environmentally and economically practical. 
  • In April 2020, Keppel DC REIT partnered with Toll Group for the development of a floating data center in Singapore based on modular data center designs that can be scaled based on demand. Keppel is likely to consider deploying the floating data center solution of Nautilus Data Technologies. In October 2020, Keppel DC REIT signed an MOU with City Gas and City-OG Gas Energy Services to develop the hydrogen floating data center project. 
  • In July 2022, Nautilus Data Technologies, a data center service, and technology provider, entered the data center market of the Philippines through its partnership with the DFNN, an IT firm in the Philippines.  
  • In May 2022, Nautilus Data Technologies entered into an agreement with Thailand property developer Raimon Land to build water-cooled data centers in the region.  
  • In August 2022, OneAsia announced plans to launch the first liquid immersion cooling system in its Hong Kong data centers. 

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