01 Rising Deployment of Modular Data Centers In recent years, modular data center construction has been a significant market trend. It is a driving factor in meeting the growing demand for additional data centers in the future years. To reduce network latency, many telecommunication providers are deploying modular data centers. They are usually deployed in remote locations to balance the demand for low latency with investment and power usage. In many cases, they can also be used to meet the demand for high power density. In addition, the cost of operating a modular data center is around 30% lesser than that of a traditional data center facility.Modular data centers include power and cooling systems, cabinets, and racks. They are primarily plug-and-plug and less expensive to build because they are made of standardized components. In addition, modular data centers cater to significant challenges such as a high PUE, high operational costs of traditional data centers, and the need for a skilled workforce to handle data center operations. Modular data centers can be used in cases where rapid deployment needs to take place.
02 Increase in Rack Power Density The rack power density is one of the critical factors in data center design, capacity planning, cooling, and power provisioning. There has been a rise in the rack power density in IT equipment over the past few years. The adoption of compute-intensive workloads such as AI, IoT, Augmented and Virtual Reality, and the increasing trend of cryptocurrency mining have increased data storage and processing requirements, which has led to the adoption of high-density racks.The average rack power density has increased over the last few years for data centers offering colocation and cloud-based services. The data center market witnessed a higher adoption of converged and hyper-converged infrastructure from cloud and enterprise data center operators. The increasing popularity of cryptocurrency globally has increased the rack power density. The growing rack power density increases the need for efficient cooling systems. These servers consume more power due to the sheer load of data traffic, so the heat generated from the servers will go up, too, thus raising the need for cooling.
01 Increasing Carbon Emissions and Power Outages In recent years, data centers across the globe have increased the demand for electricity due to the construction of extensive hyper-scale data center facilities. Data centers contribute over 1% of greenhouse gas emissions and consume around 3% of power worldwide. Most data centers are also looking to reduce carbon emissions and power wastage by using energy-efficient cooling infrastructure, moving toward free-cooling technology, improving server utilization through virtualization, and removing comatose servers.Furthermore, data center operators are equipping racks with up to 40 kW of power density, increasing power consumption and heat in smaller spaces. Higher power consumption among data centers also leads to more carbon-dioxide emissions, hampering market growth.
01 Implementation of Monitoring and Automation Solutions Modern data centers are increasingly designed with end-to-end monitoring and facility automation, reducing power usage and waste. The traditional capacity planning in most data centers failed due to a workforce crunch. In most cases, the data center operators and the IT management needed to prepare to support mass remote access to the technologies and tools. In addition, traditional capacity planning is CAPEX-heavy for data center operators and needs to be more accurate. Moreover, as data stored in hyperscale facilities is in exabytes, the power outage cost can be high compared to small facilities. Such factors have contributed to tremendous growth in data center infrastructure management (DCIM) technologies.Modern data centers are increasingly being designed with end-to-end monitoring and facility automation, reducing power usage and wastage and decelerating power consumption over the last three years compared to a decade ago. Data center operators are also adopting intelligent monitoring using technologies such as Artificial Intelligence (AI) to minimize errors associated with manual interventions. Various hyperscale data center operators such as Digital Realty, Google, Facebook, Equinix, and Microsoft are investing in software-defined power infrastructure to minimize data center downtime.
February 2026 STULZ GmbH expanded its CyberAir precision cooling portfolio with AI-enabled thermal management and liquid cooling integration for high-density AI and HPC data centers. The launch enhances cooling performance while enabling real-time optimization of data center environments.
October 2025 Schneider Electric partnered with NVIDIA to develop integrated cooling and power infrastructure for AI data centers. The collaboration combines Schneider Electric's precision cooling technologies with NVIDIA's AI infrastructure to improve thermal efficiency and support next-generation high-density computing deployments.
June 2025 Vertiv Holdings Co. introduced the Liebert® PCW chilled water precision cooling system with enhanced intelligent controls for enterprise and hyperscale data centers. The new solution is designed to improve energy efficiency, scalability, and operational reliability for mission-critical facilities.