MEA  Region Green Data Center Market To Witness Investment Of USD 1.5 Billion by 2027. More Than 2GW Power Capacity To Be Added In The Next 6 Years – Arizton

According to Arizton’s latest research report, the Middle East and Africa green data center market will grow at a CAGR of 15 per cent from 2021-2027. Major cloud service providers in the region expect to expand their presence during the forecast period, which enhances the demand for wholesale colocation services in the region. The Middle East and Africa green data center will witness investments from cloud service providers, such as Google, Amazon Web Services, Microsoft, Oracle, and Tencent. The UAE, Saudi Arabia, Kuwait, Bahrain, Oman, Turkey, Israel, Qatar, South Africa, Kenya, and Nigeria witnessed commercial investments in deploying the 5G network.

Key Highlights

The Middle East and Africa green data center market account for around 10 per cent of the overall data center market in the region. The region, primarily Africa-based countries, has been slow in adopting efficiency in operations due to lower fund availability. However, investment is expected to grow with more funding flowing into the industry and global operators entering the market.

Colocation operators in the Middle East and Africa green data center market, such as Equinix, Moro Hub, Digital Realty, Gulf Data Hub, and Rack Centre, have been investing in efficient operations to achieve their sustainability goals.

Innovations in green operations are also being explored. For instance, Saudi Arabia is exploring free cooling using salt and sunlight, wherein this electricity-free cooling technique is being developed at King Abdullah University of Science and Technology (KAUST).

The increased hyperscale data centers in the region and the need to power the facilities with renewable energy will also be a significant revenue boost for renewable energy suppliers and energy companies.

Government Interest in Curbing Carbon Emissions Will Drive Market Development

o  Several regional governments are driving the requirement for sustainable data center operations to ensure a reduced carbon footprint. Several countries have announced plans to become carbon neutral between 2030 and 2050.

o  The Saudi Arabia government aims to achieve net zero emissions by 2060. It is conducting the Middle East Green Initiative (MGI) Summit and the Saudi Green Initiative (SGI) in November 2022 to chart actionable plans to combat climate change.

o  The UAE has planned to reduce its carbon emissions by 31 per cent by 2030.

o  As per the National Determined Contribution (NDC) 2020, South Africa announced that its range of GHG emissions will be between 398 million tonnes of CO2 to 440 million tonnes of CO2 by 2030.

o   Governments are also partnering with renewable energy companies to develop renewable energy projects like wind and solar farms.

High Adoption of Innovative Power Technologies

Reduced space requirement and low OPEX, achieved through less-frequent battery replacement and maintenance, are significant factors driving lithium-ion batteries’ use. UPS battery failure, especially with VRLA batteries, is another major reason for power outages in data centers, further prompting operators to migrate to lithium-ion UPS solutions.

It has a low TCO due to a longer lifecycle, low maintenance requirements, great energy efficiency, and endurance for higher temperatures. Reduced cooling system demand equals lower power use and CO2 emissions. Furthermore, lithium-ion batteries are significantly smaller and lighter, saving space and structural support in structures because of their increased power and energy density.

APAC Green Data Center Market –  The APAC green data center market was valued at US$ 7 billion in 2021 and is expected to reach USD 13.1 billion by 2027, growing at a CAGR of 10.99 per cent from 2022-2027. The region is one of the most dynamic global data center markets, with increased investments from colocation providers and hyperscale operators. The growing number of internet users, increased use of social media, elevated smartphone penetration, increased adoption of cloud services, and the need for enterprises to migrate from server room environments to data centers are the major drivers of the APAC green data center market.

Latin America Green Data Center Market –  The Latin America green data center market was valued at US$455 million in 2021 and is expected to reach US$ 825 million by 2027, growing at a CAGR of 10.43 per cent from 2022 to 2027. A green data center is focused on the sustainability of the data center. The region’s increasing digitalization, previously underserved status, the shift to the cloud, the growing popularity of IoT and big data, the emergence of 5G networks, the COVID-19 pandemic, and the demand for high-speed streaming of online entertainment content are some of the major factors driving the growth of the data center market in Latin America. With the tremendous growth in data center deployment, the green data center market is becoming a leading trend in data center development and operations.

Green Data Center Market –  The global green data center market is expected to reach US$ 35.18 billion by 2027 from US$ 35.58 in 2021, growing at a CAGR of 7.58 per cent from 2022 to 2027. One of the prominent features of the market is that it has helped companies reduce energy costs leading to substantial cost savings. Governments globally are bringing new policies in favor of the green data center market to curb emissions and power consumption from the facilities. For instance, Pennsylvania announced the construction of one of the most significant government solar energy projects across the United States. The Pennsylvania PULSE project will involve the construction of seven large solar arrays at locations in Columbia, Juniata, Montour, Northumberland, Snyder, and York counties, contributing toward a significant development in the North America green data center market.

Middle East and Africa Data Center Market –  The Middle East and Africa data center market is expected to grow at a CAGR of over 10 per cent from 2022 to 2027. It is projected to cross US$12 billion by 2027 from US$6 billion in 2021. The Middle East & Africa data center market has attracted significant investments in recent years, led by countries such as Israel, Oman, Qatar, Saudi Arabia, Turkey, the UAE, South Africa, Kenya, Egypt, and Nigeria. Middle East & African countries are working toward adopting digital transformation to attract foreign investments. Moreover, 5G network deployment fuels digital transformation, IoT, smart cities, and the fourth industrial revolution.