In-depth Analysis and Data-driven Insights on the Impact of COVID-19 Included in this Global Data Center UPS Market Report.
The data center UPS market has witnessed a significant evolution over the last decade. The market is currently witnessing the implementation of rack-level (1U to 3U size) UPS systems to overcome frequent power fluctuations and outages. Vendors are offering UPS systems with varied capacities, ranging from 10 kVA to 1,500 kVA. As UPS systems are a critical infrastructure component in the data center design, the increasing adoption of advanced technology such as cloud services, IoT, and big data analytics has increased the rack power density and server virtualization. The growth in rack power density and the construction of multiple data center campuses with a power capacity of over 50 MW have necessitated the demand for redundant UPS capacities with N+N, 2N, and 2N+N redundant systems.
Construction and logistic processes in the data center industry are likely to get affected due to the outbreak of the corona pandemic. Construction contractors have halted their structural and infrastructure construction amid the outbreak of COVID-19. Non-essential construction projects have been brought to a halt to prevent the spread of the virus.
The pandemic has already delayed the construction of new facilities. For instance, Facebook's Ireland data center, which is in its final development phase, identified workers displaying flu-like symptoms. Hence, the pandemic is likely to delay several structural and infrastructure-related work, thereby hindering the growth of the data center market.
The following factors are expected to contribute to the growth of the data center UPS market during the forecast period:
Use of Lithium-ion Batteries
Adoption of DC UPS Systems to Reduce Power Loss
Increasing Demand for Edge Data Centers
Growth in Investments
DATA CENTER UPS MARKET SEGMENTATION
This research report includes detailed segmentation by system capacity, systems, tier standards, and geography. North America is strongly driving the global data center UPS market, with several recent activities targeting the construction of hyperscale facilities with over 20 MW of power capacity. The market has been witnessing a strong growth of UPS systems in the last few years, coupled with the high deployment of large and medium facilities. The high procurement of AI-based infrastructure solutions, which are growing the rack power density over 15 kW, will be a major driving factor growth of the rack-level systems market.
Western Europe has witnessed significant growth in terms of investment. Germany has witnessed the highest investment, followed by the Netherland, the UK, France, and Ireland. The revenue from UPS systems is likely to increase due to the high adoption of modular, scalable, and lithium-ion powered systems in Europe. The use of lithium-ion and nickel-zinc batteries can reduce the adoption of flywheel and VRLA-battery systems. However, the cost of lithium-ion is two times more than traditional UPS systems. In terms of capacity, the adoption of these systems is likely to be high 5001,000 kVA units that are installed in parallel to provide a total capacity of 2 MW.
The APAC data center market is witnessing steady growth with continued investments from hyperscale and cloud service providers. With the construction of additional facilities, local colocation providers in the APAC region are increasing their presence, thus boosting the data center UPS market growth. It is expected that the APAC region will witness the implementation of edge computing places across various countries, particularly China and India, to accommodate the region's data growth. This will, in turn, increase the demand for modular rack-level power infrastructure solutions in the market. Several facilities, especially in Southeast Asia, Australia, and Japan, are procuring DRUPS systems. This will reduce the market for stand-alone flywheel UPS as well as other battery technologies. The operators in the APAC region are more likely to adopt 2N or N+1 redundant power infrastructure, including UPS systems.
The demand for less than equal to 500kVA UPS is higher among small- and medium-sized facilities and hyperscale data centers. In a few installations, multiple 2U UPS systems are adopted inside a single rack to support multiple rows of IT infrastructure at the row-level in data centers. Many facilities use 500 kVA systems that can support the entire containment of 20 racks or more of (hot/cold) IT systems. The growth of less than equal to 500 kVA systems will be high among prefabricated operators than traditional brick-and-mortar facilities.
The UPS market has a high potential in facilities that are adopting DC systems. The 500-1,000 kVA segment witnessed significant growth and accounted for a high proportion of power capacity in 2019. These systems are highly suitable for medium to large facilities with multiple data halls. Delta, Fuji Electric, Huawei Enterprise, Schneider Electric, Kohler, Reillo UPS, and Vertiv are dominating the segment. Vendors are offering lithium-ion based systems with a power capacity of over 500 kVA. The installation of lithium-ion systems saves space inside facilities and reduces OPEX, thereby prompting providers to adopt lithium-ion systems.
Over 350 projects fall under the Tier III category in the global data center market. Several data center operators are expected to move to the Tier IV category based on the growth in rack power density and critical applications. North America is the most dominating region in the Tier III category, followed by Western Europe and Asia. Most new facilities are designed to be of Tier III standards with a minimum of N+1 redundancy. They can be reconfigured with up to 2N+1 redundancy as the need arises, with the incorporation of flexible designs. Tier IV data centers are equipped with at least 2N+1 redundancy in every infrastructure that makes the facility fault-tolerant, with a few having 2N+2 redundancy in a few critical infrastructures such as UPS systems and PDUs.
In 2019, more than 50 Tier IV projects were either open or under construction. In the UK, most facilities are either Tier III or Tier IV certified by the Uptime Institute due to their high standard design and construction that includes redundant configuration. The Ireland market has witnessed the construction of the Tier III colocation and Tier IV facilities from the cloud and hyperscale operators.
KEY VENDOR ANALYSIS
Over the next few years, data center operators are likely to consider the adoption of lithium-ion batteries to improve efficiency and reduce OPEX as well as carbon emissions. This will intensify the competition among the vendors. In terms of back systems, all vendors are offering VRLA-based battery systems. Also, most providers are providing lithium-ion battery solutions for their UPS systems. The data center UPS market is expected to witness high competition during the forecast period based on efficiency and cost. Changing requirements of the operators are prompting vendors to develop innovative systems that have more than 97% efficiency to enable high availability service offerings in data centers. ABB, Eaton, Schneider Electric, and Vertiv are among the leading players.