Key Points
- Green data centre market projected to reach $90.38 billion by 2035 from $26.71 billion
- Direct-to-chip liquid cooling segment forecast to grow sevenfold to $17.33 billion
- Retrofit spending expected to triple as facilities adapt to AI workload density
The global green data centre market is projected to reach $90.38 billion by 2035, more than tripling from its 2025 valuation of $26.71 billion, according to a market research report that attributes the growth primarily to artificial intelligence infrastructure demands.
The report by DC Market Insights forecasts the sector will grow at a compound annual growth rate of 12.96 per cent over the decade. AI-driven rack density is increasing the value of efficient power and cooling systems per megawatt, while water constraints, grid pressure and rising energy costs are pushing operators to combine liquid cooling, heat reuse, renewable power and facility retrofits, the report said.
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Direct-to-chip liquid cooling represents one of the clearest growth segments, with the report projecting this technology to expand from $2.41 billion in 2025 to $17.33 billion by 2035. Retrofit spending on existing facilities is forecast to increase from $5.21 billion to $18.41 billion as data centres adapt to denser AI workloads and stricter efficiency targets.
Regional distribution
North America led the market in 2025 with a 41.4 per cent share, followed by Asia Pacific at 28.4 per cent and Europe at 21.3 per cent. Latin America and the Middle East and Africa accounted for 4.7 per cent and 4.2 per cent respectively, according to the report.
The regional outlook shows differences in hyperscale investment, AI adoption, power availability, semiconductor ecosystems and local data centre construction pipelines, the report noted.
AI halls carried approximately $3.09 million of green power and cooling content per megawatt in 2025, materially increasing green infrastructure value per unit of IT capacity, according to the report’s findings.
“Green data center investment is moving from a compliance conversation to a capacity conversation,” said Satyabrat Rajawat, senior research analyst, DC Market Insights and the report’s author. “AI racks create more heat and draw more power, so efficient cooling, power distribution and reuse strategies can determine whether a site can support the next phase of compute growth.”
Industry developments
Citing several recent industry developments, the report stressed that the sector is on growing trajectory. Microsoft said its newer data centre design consumes zero water for cooling and can avoid more than 125 million litres of water use per year per data centre, with the first sites expected online in late 2027, according to the company.
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By the numbers
Key figures from this story
- $90.38B
- Projected green data centre market size by 2035
- $17.33B
- Direct-to-chip liquid cooling market forecast for 2035
- 12.96%
- Compound annual growth rate over the decade
NextEra Energy and Google announced a 25-year agreement tied to the planned restart of the 615 megawatt Duane Arnold nuclear plant in Iowa, subject to regulatory approvals. Eaton agreed to acquire Boyd Thermal for $9.5 billion and completed the transaction in March 2026, expanding its thermal management capabilities for high-density computing, the report said.
Grid capacity is becoming an increasingly important constraint, making energy efficiency a capacity-enablement issue rather than solely an environmental, social and governance objective, according to the report. Operators continue to increase investment in liquid cooling and retrofit programmes as AI rack densities exceed the practical limits of conventional air-only designs.
The market increased from $7.25 billion in 2020 to $26.71 billion in 2025 as operators invested in more efficient power, cooling and control systems, the report said. AI infrastructure is accelerating this shift because high-density halls require advanced thermal management and greater electrical efficiency.
Competition spans electrical infrastructure, thermal management, building controls and integrated data centre systems, according to the report. Schneider Electric, Vertiv and Eaton are expanding portfolios around high-density power and liquid cooling, while heating, ventilation and air conditioning specialists and regional equipment vendors compete in thermal management. Merger and acquisition activity is reinforcing the convergence of power and cooling capabilities.
Your Questions, Answered
How large is the green data centre market projected to be by 2035?
The global green data centre market is projected to reach $90.38 billion by 2035, growing from $26.71 billion in 2025 at a compound annual growth rate of 12.96 per cent, according to DC Market Insights.
Why is liquid cooling becoming important for data centres?
AI workloads create higher rack densities that generate more heat than conventional air cooling can manage. Direct-to-chip liquid cooling is projected to grow from $2.41 billion in 2025 to $17.33 billion by 2035.
Which region leads the green data centre market?
North America led the market in 2025 with a 41.4 per cent share, followed by Asia Pacific at 28.4 per cent and Europe at 21.3 per cent.
What is driving green data centre investment?
Investment is shifting from compliance to capacity concerns. Efficient cooling and power systems determine whether facilities can support AI compute growth, while grid constraints and water scarcity add pressure.