The data center market is in the midst of an unprecedented shift that started—publicly at least—five years ago with the announced moratoria on new development in Singapore and Frankfurt. Those regulatory interventions highlighted the challenges the industry faces in securing sufficient power.
Since then, it turned out that data centers would need much more power than had been realized—just at a time when regulators and community organizations were growing increasingly critical of the sector's existing demand.
Our Data Center Research Service estimates that, as of 2024, colocation operators in the top ten data center markets by MW consume about 13 gigawatts (GW) of power.
That's enough power to generate electricity for roughly 10 million homes—or, in this case, only about 1,000 commercial data centers!
However, only 17% of data center sites reporting are able to provision high-density aisles that exceed 20 kW per rack.
This is troubling, especially when considering that AI applications will require density levels in the range of 45 to 80 kW per rack—far in excess of traditional standards of high density.
Power Scarcity
Several critical hubs have undergone major power scarcity crises, but utility problems are global and not confined to only a few major markets.
Formally and informally, operators indicate that markets across the globe are seeing increased delays in securing power for new builds. Existing generation and transmission resources are proving insufficient to meet the surge in demand for cloud and AI computing.
One key and growing response to the crisis has been to deploy new data centers closer to the source of power generation.
One key and growing response to the crisis has been to deploy new data centers closer to the source of power generation.
AWS has proactively taken this approach in a few different markets, most recently with its purchase of the Cumulus data center campus that's colocated with the Susquehanna Steam Electric Power Station in Salem Township, PA.
The data center industry is anxiously awaiting the commercial availability of small modular reactors (SMRs) as a potential source of ample power generation. Such technology would allow nuclear reactors of around 300 MW to be deployed at data center campuses, providing dedicated power to the sites.
Early development of SMRs is already underway in several countries.
Our Data Center Research Service is a comprehensive guide for understanding data centers, network storage, and the nature of interconnection.
Download the 2024 Summary of Findings to keep reading this analysis.
Jon Hjembo
Senior Research Manager Jonathan Hjembo joined TeleGeography in 2009 and heads the company’s data center research, tracking capacity development and pricing trends in key global markets. He also specializes in research on international transport and internet infrastructure development, with a particular focus on Eastern Europe, and he maintains the dataset for TeleGeography’s website, internetexchangemap.com.