Global Data Center Liquid Immersion Cooling Market 2025 – 2034

The global data center liquid immersion cooling market size was valued at USD 1.24 billion in 2025, and the total market revenue is expected to grow at a CAGR of 27.94% over the forecast period, reaching nearly USD 3.98 billion by 2034.

Data Center Liquid Immersion Cooling Market Overview

The data center immersion cooling industry is experiencing growth as a result of the increasing prevalence of high-density computing applications and the increasing generation of data. The demand for efficient cooling solutions is on the rise as organizations generate vast quantities of data from a variety of sources.

Furthermore, the market’s growth trajectory is fueled by the necessity for sophisticated cooling methods, such as immersion cooling, to manage the heat generated by densely packed servers, which is a result of the proliferation of AI, machine learning, and big data analytics.

For example, in August 2023, CyrusOne unveiled a data center design that was specifically designed for AI applications. This design utilized immersion cooling and other advanced techniques to attain exceptionally high power densities. The objective of this innovative method is to enhance the efficacy of AI workloads.

In order to accommodate the growing duties, data centers necessitate more efficient cooling solutions as technology advances. Immersion cooling is a highly efficient alternative that dissipates heat more effectively than conventional methods. This emphasis on energy efficiency is consistent with industry requirements, which in turn stimulates the market’s expansion and encourages the adoption of immersion cooling systems.

For example, in January 2024, Stack introduced a data center liquid cooling solution that is capable of sustaining 300 kW or more per rack through immersion cooling. The customizable options available to them include air cooling at 30 kW per rack, door-mounted heat exchangers at 50 kW, and direct-to-chip liquid cooling at up to 100 kW.

Data Center Liquid Immersion Cooling Market Growth Factors

The emergence of green data centers to capitalize on the potential of liquid cooling, including immersion cooling.

The green data center industry is anticipated to experience growth due to the implementation of efficiency regulations on data centers and the benefits of government support and technology. A Guideline for Pilot Projects of Green Data Centers (GPPGDC) document was released by China’s MIIT (Ministry of Industry and Information Technology), National Energy Administration, and National Government Offices Administration.

This document delineates the process of implementing the state council’s energy-saving recommendations. The India Green Building Council (IGBC) has contacted the Uptime Institute, and they are currently in the process of creating a green standard for data centers in India. In February 2020, the European Union developed a digital strategy plan with the objective of achieving carbon neutrality and increased energy efficiency in data centers by 2030.

As part of its long-term objective to utilize 100% renewable energy to power all AWS data centers, Amazon Web Services announced three new renewable energy initiatives in Ireland, the United States, and Sweden in April 2019. By 2025, Microsoft plans to establish a data center that is wholly powered by renewable energy. Servers and data equipment are responsible for approximately 55% of the energy required by a data center, while refrigeration equipment consumes 30% of the energy required to maintain the facility’s functionality.

Ciena, a network strategy and technology company, reports that energy accounts for 40% of the total operational costs of data center administrators (enterprises and cloud service providers). These costs can be mitigated by replacing the equipment with low-power-consuming devices.

Therefore, this development is creating opportunities for liquid immersion cooling technologies in data centers, as it is regarded as one of the most effective methods for addressing the high-power density challenges that are encountered in data centers. This is anticipated to generate profitable opportunities in the data center liquid immersion cooling market.

Increase in the Number of Hyper-Scale Data Centers to Drive the Growth of the Data Center Liquid Immersion Cooling Market

Hyperscale data centers offer exceptional scalability, enabling businesses to remain competitive while simultaneously increasing storage, security, flexibility, and speed. The demand for data centers is anticipated to increase as a result of the increasing development of IT infrastructure in emerging nations, including China and India. It is anticipated that the demand for data centers will increase as a result of the cloud model’s economic and operational advantages for the IT sector.

More than half of respondents (52%) indicated that the cloud will have the most transformative impact on their organization’s business processes, as per a survey conducted by NTT Ltd. Consequently, the demand for data center cooling will rise, resulting in the implementation of liquid cooling methods that are tailored to the preferences of end users.

Arizton Advisory and Intelligence’s report on the Indian data center market predicts that the industry will expand at a compound annual growth rate (CAGR) of 12 percent until 2026. This expansion will be stimulated by numerous technologies and trends.

The following are the ones that we anticipate will continue to have an impact in 2023. The pandemic is anticipated to increase the use of automation by 73% of data center administrators, according to a recent poll conducted by the Uptime Institute. Additionally, one-third of the respondents anticipated that the number of operations teams would decrease as a result of recruiting issues, despite the fact that the number of servers is on the rise.

In 2023, private equity and significant investment groups maintained their acquisition of tens of billions of dollars in data center market share, with no plans to reduce their pace. Therefore, the expansion of the data center liquid immersion cooling market is anticipated to be driven by the rise in the number of hyper-scale data centers.

Data Center Liquid Immersion Cooling Market Trends

In 2020, the demand for global space cooling increased as a result of the increased use of household conditioning as individuals spent more time at home. Approximately 16% of the total building power consumption (approximately 1,885 TWh) was attributed to space cooling in 2020.

The necessity of a cooling system to enhance efficiency is evident in the compelling evidence that data center operators have increased rack density in recent years (AFCOM). Then, as the utilization of big data and AI, to mention a few, has increased, enterprises are confronted with a data crunch dilemma.

For example, IBM Corporation constructed four new cloud data centers in the United States in response to the increasing demand for cognitive capabilities. This is expected to promote the implementation of cooling technologies in these data centers. This is anticipated to stimulate the expansion of the data center liquid immersion cooling market.

As of December 2020, the annual survey revealed that racks with densities of 20 kW and higher are being deployed at an increasing rate. The majority of respondents emphasized their highest density rack utilization in the 10-19 kW range on a year-over-year basis. When the preferred rack density exceeds 20-25 kW, direct liquid cooling becomes more cost-effective and efficient.

As per Asperitas Company, the energy footprint of IT alone is reduced by 10% to 50% by submerging all electrical components in a dielectric liquid through liquid immersion cooling. It further stated that dielectric liquids that are suitable for the application absorb approximately 1,500 times more thermal energy than air at the same volume and temperature.

High Investment and Greater Capital Expenditure to Limit the Growth of the Data Center Liquid Immersion Cooling Market

The widespread availability of cooling fans on the market suggests that they are reasonably priced. The components of a liquid cooling system may be expensive. In the past, liquid cooling systems relied on components from automobiles and aquariums, among other sources. At present, a number of organizations offer liquid cooling components for personal computers.

Over time, the cost of replacing failing servers at a higher frequency than is typical for a large organization may be less expensive than the cost of sustaining a hyperscale facility at lower temperatures. Nevertheless, the necessity for increased computational power has necessitated that significant organizations transition to an effective cooling system, as the integration of GPUs in data centers continues to expand.

The initial expenses of the two-phase immersion cooling system are significantly higher than those of the single-phase immersion system due to the sophisticated engineering. The cost of immersion technology is higher than that of established methods due to the fact that it is more recent than water or air cooling, and cooling technology is constantly evolving.

Additionally, the cost of fluorocarbon-based coolants is substantial due to the necessity of routine refilling. The cost of these coolants per gallon is in the hundreds of dollars, which increases the overall operating costs and counteracts any minor improvements in power efficiency.

Additionally, the total cost of ownership (TCO) is a factor. Consequently, it is anticipated that the development of the data center liquid immersion cooling market will be restricted by the high investment and increased capital expenditure.

Data Center Liquid Immersion Cooling Market Segmentation Analysis

Based on Cooling Technique:

The market is split into two categories: single-phase cooling and two-phase cooling, which are based on the cooling technique. The single-phase segment was valued at more than USD 700 million in 2023. Its versatility and efficacy are the primary factors contributing to the segment’s expansion. This approach entails the submersion of IT equipment in a dielectric fluid, which facilitates the efficient dissipation of heat.

Companies prefer single-phase immersion cooling due to its simplicity and capacity to efficiently manage high-density duties. The single-phase cooling segment has maintained its dominant position by providing reliable and efficient cooling solutions for a variety of applications despite the growing emphasis on energy efficiency and performance optimization.

Based on End Use:

The market is classified into hyperscale, supercomputing, enterprise HPC, cryptocurrency, edge/5G computing, and other categories based on its ultimate use. It is anticipated that the hyperscale segment will experience a compound annual growth rate (CAGR) of more than 18% between 2024 and 2032. In 2023, the segment experienced a significant increase in demand as a result of its extensive infrastructure requirements.

The immense data processing requirements of these enormous facilities, which are operated by industry leaders, necessitate efficient cooling solutions. The demands of the hyperscale segment for performance and scalability are precisely aligned with immersion cooling technology’s capacity to effectively manage high-density servers. The hyperscale segment’s status as a critical force in the immersion refrigeration industry is further solidified by this dominance.

Report Scope

Data Center Liquid Immersion Cooling Market Regional Analysis

The data center liquid immersion cooling market was primarily dominated by the North American region in 2023 and is anticipated to expand at a compound annual growth rate (CAGR) of 26.59% during the forecast period. North America is a pioneer in the adoption of emerging technology. There is a growing interest among data center investors in direct-to-chip cooling and liquid immersion methods.

The United States is one of the early adopters of the technology, and the introduction of 5G networks worldwide has contributed to the relevance of peripheral data centers. Numerous US operators, such as American Towers, EdgeMicro, and EdgePresence, have initiated investments in these centers.

Microsoft is among the companies in the United States that are currently conducting research on the implementation of immersion cooling in data centers. The implementation of two-phase immersion cooling in the production environment is the subsequent phase of Microsoft’s long-term strategy to address the demand for more resilient, faster data center computers during a period in which reliable advancements in air-cooled computer processor technology have reached a significant plateau.

Microsoft conducted research on liquid immersion as a cooling solution for a variety of high-performance computer applications, such as artificial intelligence. The results indicated that the power consumption of each specific server was reduced by 5% to 15% as a result of the implementation of two-phase immersion cooling.

Liquid Immersion of Asia Pacific Data Centers The cooling market is anticipated to expand at a substantial compound annual growth rate (CAGR) throughout the forecast period. The data center industry in the region is experiencing rapid growth, with a focus on ensuring optimum uptime and efficiency.

In order to guarantee the stability and dependability of data services, larger organizations are striving to expand their data centers. This is due to the increasing demand for processing capacity that is being driven by the use of 5G, wearable devices, the internet of things, and artificial intelligence.

Additionally, in response to the exponential increase in demand for digital infrastructure in India, companies such as GRC are establishing their first Asian office in the country. This is being driven by the proliferation of affordable smartphones and connectivity, which is enabling a greater number of India’s 1.3 billion population to access the internet.

As part of the Digital India Program, the government is also promoting digitalization and proposing data location legislation to facilitate the rapid construction of data center infrastructure. Additionally, the region’s need for immersion refrigeration is significantly influenced by the ongoing pursuit of environmental sustainability in Asia.

The transition to India to serve the Asia-Pacific market is poised to generate substantial opportunities due to the rapid expansion of digital infrastructure in Asia, which is home to some of the world’s fastest-growing civilizations. Numerous Asian markets are confronted with challenges that immersion cooling technologies are uniquely equipped to address.

Legacy air-cooling is a significant concern for data center proprietors due to the high temperatures and humidity, as well as the high cost of property and the sensitivity of prices. These issues are resolved by immersion-cooling technologies, which have a reduced footprint and lower operating and power costs.

List of the prominent players in the Data Center Liquid Immersion Cooling Market:

• 3M Company
• Alfa Laval AB
• Asetek Group
• Asperitas B.V.
• DCX – The Liquid Cooling Company
• Fujitsu Limited
• Green Revolution Cooling Inc.
• Midas Green Technologies LLC
• Schneider Electric SE
• Submer Technologies S.L.
• Others

The Data Center Liquid Immersion Cooling Market is segmented as follows:

By Component

• Solution
  • Cooling fluids
  • Cooling racks/modules
  • Filters
  • Pumps
  • Heat exchangers
  • Others
• Service
  • Installation & maintenance
  • Training & consulting

By Cooling Technique

• Single phase cooling
• Two-phase cooling

By Cooling Fluid

• Mineral oil
• Synthetic fluid
• Fluorocarbons-based fluid

By Organization Size

• SME
• Large enterprises

By End Use

• Hyperscale
• Supercomputing
• Enterprise HPC
• Cryptocurrency
• Edge/5G computing
• Others

Regional Coverage:

North America

• U.S.
• Canada
• Mexico
• Rest of North America

Europe

• Germany
• France
• U.K.
• Russia
• Italy
• Spain
• Netherlands
• Rest of Europe

Asia Pacific

• China
• Japan
• India
• New Zealand
• Australia
• South Korea
• Taiwan
• Rest of Asia Pacific

The Middle East & Africa

• Saudi Arabia
• UAE
• Egypt
• Kuwait
• South Africa
• Rest of the Middle East & Africa

Latin America

• Brazil
• Argentina
• Rest of Latin America