Emerging Market Data Centre Pipeline Doubles Current Global Capacity: Report
Emerging markets could become next major engine of growth for global data centre industry with planned developments amounting to nearly twice the size of current worldwide operating capacity, a report has said. According to a report by S&P Global Ratings, growing opposition to data centre construction in developed economies is prompting operators to seek expansion opportunities elsewhere,…
An S&P Global Ratings report predicts that emerging markets could soon become the primary force behind global data centre growth, with planned projects expanding capacity to nearly double the current worldwide operating capacity. The surge in data centre construction in developing economies is being driven by increasing resistance to such projects in established markets.
However, the report indicates that the distribution of these opportunities will not be uniform, depending heavily on factors such as government policies, natural resource availability, and existing infrastructure.
The report suggests that project conversion rates will vary significantly across regions, favoring countries with dependable electricity grids, clear permitting processes, access to renewable energy, and ample capital. Water and energy availability emerge as the key risks facing the sector, with rapid expansion in data centres often clashing with power grid shortages and water stress in fast-growing hubs.
This is particularly evident in Asia-Pacific, where rapid growth in markets like India is straining power infrastructure and pushing for more renewable energy adoption.
Conversely, concerns over grid reliability could lead operators to rely on less environmentally friendly independent power sources. In the Middle East, while abundant and cheap power supports data centre growth, acute water scarcity poses a significant challenge. While solar energy expansion is aiding the sector, operators in increasingly dry regions may need to invest in technologies like solar-powered desalination and advanced closed-loop cooling systems to manage resource constraints.
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