Data Center Generator Market Size
| Study Period | 2019 - 2029 |
| Market Size (2024) | USD 7.22 Billion |
| Market Size (2029) | USD 9.14 Billion |
| CAGR (2024 - 2029) | 4.85 % |
| Fastest Growing Market | Asia Pacific |
| Largest Market | North America |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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Data Center Generator Market Analysis
The Data Center Generator Market size is estimated at USD 7.22 billion in 2024, and is expected to reach USD 9.14 billion by 2029, growing at a CAGR of 4.85% during the forecast period (2024-2029).
Data centers are at significant risk of experiencing operational losses owing to power outages caused by utility grid failures, rolling blackouts, bad weather, natural or artificial calamities, or electrical breakdowns. Systems and components used in data centers are expected to operate nonstop. They require dependable, uninterrupted power seven days a week, creating a demand for the data center generator market.
The growth of digital data has significantly fueled the market studied. The need for data centers has increased as the population grows increasingly connected and dependent on digital infrastructure. The amount of digital data produced globally is growing rapidly.
Moreover, the emerging cloud technology in a wide range of data centers is one of the major factors driving the overall demand for data center systems and technologies, thereby fueling the studied market's growth. Continued high demand for data centers is expected to be driven by fast growth such as AI and other modern technologies, e.g., streaming gaming or autonomous car technology. As operators strive to provide the capacity that will allow them to meet increased power density requirements for HPC, innovation in data center design and technology may also be stimulated.
Due to an increase in data center construction and the increased number of hyperscale buildings by colocation and hyperscale operators, the global market for power generators has expanded. In several emerging countries, such as Brazil, Denmark, Singapore, Australia, Canada, India, Japan, Sweden, South Korea, and so on, several hyperscale data center projects have been identified. These projects in these countries are creating opportunities for suppliers of energy infrastructure.
The escalating growth of carbon emissions from data centers poses a significant restraint for data center operators and their generators. As the demand for digital services and storage continues to surge, the environmental impact of these facilities becomes an important concern. This issue necessitates comprehensively examining the challenges and potential solutions for mitigating carbon emissions from data centers.
With the outbreak of COVID-19, the cloud market gained significant traction as cloud-based services and tools are increasingly adopted due to organizations deploying remote work access amid lockdowns in various countries, as indicated in the graph. Most data centers worldwide witnessed a massive surge in demand owing to the growth of cloud adoption across all sizes of enterprises.
Data Center Generator Market Trends
Natural Gas Segment to Witness Major Growth
- The demand for natural gas generators in the data centers is expected to experience significant growth in the coming years owing to the benefits associated with natural gas, such as being cleaner, less expensive than other non-renewable fuels, and considerably efficient. Natural gas is also readily available in large cities since it is delivered directly through pipelines, thus positively driving the demand as the strong underground pipeline network is rarely impacted by weather. According to GGON, by October 2023, there was a total of 1,869 operational gas pipelines, and around 400 were newly proposed globally.
- Recent advances in generator technology make natural gas generators an attractive option to achieve continuous power and make strides toward corporate sustainability commitments. Natural gas is the cleanest burning of fossil fuels, is readily available in most locations, and is more cost-efficient than diesel. Built-in storage with a highly reliable natural gas grid avoids risks of limited run times and refueling, thus emerging as an attractive option for data center operators.
- Data centers are becoming more dynamic, reaching scale in size and complexity and achieving record power usage levels. As these data superusers approach zero tolerance for power outages, the demand for resilient and sustainable backup power solutions such as natural gas generators is becoming increasingly critical to maintaining today’s standard for 100% uptime. Additionally, natural gas prices have remained relatively stable compared to traditional fuels, ensuring long-term cost-effectiveness for data center operators.
- Advancements in gas extraction technologies have increased availability and reduced prices, making natural gas an economically viable option for power backup in data centers. New launches of innovative natural gas engines may further positively influence the market's growth during the forecast period.
Asia-Pacific is Expected to Witness Significant Growth
- Rapid growth in the number of data centers in Asia-Pacific, supplemented with the government’s initiatives, has made the region one of the fastest-expanding data center markets in the world, with fintech growth and digital transformation in the region.
- The increasing investments by global and regional facility operators and the rising adoption of public cloud and hybrid cloud services are the primary factors contributing to the growth of the APAC region's data center generator market.
- Moreover, the digital transformation across various sectors has intensified the demand for increasing data infrastructure. Due to this, many companies are launching data centers in the region. For instance, in December 2023, NTT Global Data Centers Japan, a subsidiary of NTT DATA Group Corporation, and TEPCO Power Grid, Inc. announced that both companies would launch a new company to jointly develop and operate data centers in the Inzai-Shiroi area of Greater Tokyo, Japan.
- These data centers are the backbone for the economic development of many Asian countries and require reliable power solutions to maintain continuous operations. The unpredictable nature of power supply in certain parts of the Asia-Pacific region has made data center generators indispensable for mitigating the risks associated with power fluctuations and outages.
Data Center Generator Industry Overview
The data center generator market is fragmented, with many large, technologically advanced players, such as Caterpillar, Cummins, Atlas Copco AB, HITEC Power Protection BV (Air Water Inc.), Himoinsa SL, etc. The rivalry is expected to be on the higher side. Market penetration is growing with the strong presence of major players in established markets. With the increasing focus on innovation, the demand for generators with different capacities is growing, which, in turn, is driving investments for further developments.
In December 2023, Cummins Inc. announced the launch of C1760D5, C1875D5, and C2000D5B generator models between 1700 kVA and 2000 kVA. The new models launched by the company are powered with the KTA50 engine series, designed and optimized for diverse power applications.
In October 2023, Mitsubishi Heavy Industries Engine & Turbocharger, Ltd. (MHIET), a part of Mitsubishi Heavy Industries (MHI) Group, approved its engine products for use with Hydrotreated Vegetable Oil (HVO). MHI Group is pursuing to achieve net zero CO2 emission by 2040 according to its declaration of "MISSION NET ZERO," and the approval of HVO aligns the effort.
Data Center Generator Market Leaders
Caterpillar Inc.
Atlas Copco AB
Cummins Inc.
HITEC Power Protection BV (Air Water Inc. )
Himoinsa SL
*Disclaimer: Major Players sorted in no particular order
Data Center Generator Market News
- October 2023 - Rolls-Royce announced the supply of 31 mtu emergency gensets and a complete mtu EnergetIQ control system for the latest data center of a global provider of hyperscale data center solutions. The hyperscale data center, located near Osaka, is one of the largest data centers in Japan, with a designed capacity of 45.9 MW. Rolls-Royce Solutions Japan has installed and commissioned eight of the 31 container gensets based on 20-cylinder mtu Series 4000 engines. The remaining emergency generators were expected to be added gradually as the data center’s capacity increased.
- August 2023 - Mitsubishi Heavy Industries Engine & Turbocharger, Ltd announced the launch of a new model MGS3100R of the MGS-R series generator in Singapore and Vietnam to meet the higher power demands for emergency generator sets that supply power at the time of power failures. MGS3100R features a newly developed S16R2-PTAWT-CR engine, which employs an electronically controlled common rail fuel injection system.
Data Center Generator Market Report - Table of Contents
1. INTRODUCTION
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
4.1 Market Overview
4.2 Market Dynamics
4.2.1 Market Drivers
4.2.1.1 Increasing Construction of Data Centers by Colocation Service Providers
4.2.1.2 Growing Construction of Hyperscale Data Centers
4.2.2 Market Restraints
4.2.2.1 Growing Carbon Emissions from Data Centers
4.3 Industry Attractiveness - Porter's Five Forces Analysis
4.3.1 Bargaining Power of Suppliers
4.3.2 Bargaining Power of Buyers
4.3.3 Threat of New Entrants
4.3.4 Threat of Substitutes
4.3.5 Intensity of Competitive Rivalry
4.4 Assessment of Impact of COVID-19 on the Market
4.5 Industry Value Chain Analysis
4.6 Environmental Impact of Diesel vs Natural Gas and Other Alternatives
5. MARKET SEGMENTATION
5.1 By Product Type
5.1.1 Diesel
5.1.2 Natural Gas
5.1.3 Other Product Types
5.2 By Capacity
5.2.1 Less than 1MW
5.2.2 1-2MW
5.2.3 Greater than 2MW
5.3 By Tier
5.3.1 Tier I and II
5.3.2 Tier III
5.3.3 Tier IV
5.4 By Geography
5.4.1 North America
5.4.2 Europe
5.4.3 Asia-Pacific
5.4.4 Latin America
5.4.5 Middle East and Africa
6. COMPETITIVE LANDSCAPE
6.1 Company Profiles*
6.1.1 Caterpillar Inc.
6.1.2 Atlas Copco AB
6.1.3 Cummins Inc.
6.1.4 HITEC Power Protection BV (Air Water Inc.)
6.1.5 Himoinsa SL
6.1.6 Kohler Co.
6.1.7 Mitsubishi Heavy Industries Group (MHI)
6.1.8 Generac Power Systems Inc. (Generac Holdings Inc.)
6.1.9 Rolls-Royce Holdings PLC
6.1.10 Aksa Power Generation
7. INVESTMENT ANALYSIS
8. FUTURE OF THE MARKET
Data Center Generator Industry Segmentation
DC Generators are the backup power supply reservoirs for the data centers during a power break. A total power cut-off from a data center may need a complete restart for the system. This may lead to system downtime, start-up issues, and current/ongoing information damage. Thus, the generators constantly support data centers with a backup power supply to evade such irregularities and failures.
The data center generator market is segmented by product type (diesel, natural gas, and other product types), capacity (less than 1MW, 1-2MW, greater than 2MW), tier (tier I and II, tier III, tier IV), and geography (North America, Europe, Asia-Pacific, Latin America, and Middle East and Africa). The market sizes and forecasts regarding value (USD) for all the above segments are provided.
| By Product Type | |
| Diesel | |
| Natural Gas | |
| Other Product Types |
| By Capacity | |
| Less than 1MW | |
| 1-2MW | |
| Greater than 2MW |
| By Tier | |
| Tier I and II | |
| Tier III | |
| Tier IV |
| By Geography | |
| North America | |
| Europe | |
| Asia-Pacific | |
| Latin America | |
| Middle East and Africa |
Data Center Generator Market Research FAQs
How big is the Data Center Generator Market?
The Data Center Generator Market size is expected to reach USD 7.22 billion in 2024 and grow at a CAGR of 4.85% to reach USD 9.14 billion by 2029.
What is the current Data Center Generator Market size?
In 2024, the Data Center Generator Market size is expected to reach USD 7.22 billion.
Who are the key players in Data Center Generator Market?
Caterpillar Inc., Atlas Copco AB, Cummins Inc., HITEC Power Protection BV (Air Water Inc. ) and Himoinsa SL are the major companies operating in the Data Center Generator Market.
Which is the fastest growing region in Data Center Generator Market?
Asia Pacific is estimated to grow at the highest CAGR over the forecast period (2024-2029).
Which region has the biggest share in Data Center Generator Market?
In 2024, the North America accounts for the largest market share in Data Center Generator Market.
What years does this Data Center Generator Market cover, and what was the market size in 2023?
In 2023, the Data Center Generator Market size was estimated at USD 6.87 billion. The report covers the Data Center Generator Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Data Center Generator Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
Data Center Generator Industry Report
Statistics for the 2024 Data Center Generator market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Data Center Generator analysis includes a market forecast outlook to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
