The data center industry is experiencing unprecedented growth, driven by artificial intelligence workloads, cloud computing expansion, and the digitization of nearly every sector of the economy. With this growth comes a challenge that facility managers and colocation providers know intimately: keeping all that computing power cool.
The global data center cooling market reached approximately $18 billion in 2024 and is projected to exceed $42 billion by 2032, growing at a compound annual growth rate exceeding 12%. North America leads this expansion, accounting for nearly 39% of global market share, with established hubs in Northern Virginia, Dallas-Fort Worth, Phoenix, and Chicago driving much of the demand.
But the real story isn’t just about market size. It’s about a fundamental shift in what cooling systems must accomplish and why traditional approaches are struggling to keep pace.
The AI Revolution Is Rewriting the Rules of Thermal Management
Just a few years ago, data center operators planned for rack densities of 5 to 10 kilowatts. Those numbers now seem quaint. Today’s AI-focused facilities routinely deploy racks drawing 50 to 120 kilowatts, with NVIDIA’s Blackwell architecture pushing individual GPU heat loads beyond 1,200 watts per chip—a fourfold increase from 2017 levels. Some facilities are now planning for rack densities approaching 140 kilowatts to accommodate next-generation AI training clusters.
This isn’t an incremental change. It’s a fundamental transformation in thermal load that renders many legacy cooling systems inadequate. Traditional computer room air conditioning units, designed for an era of lower-density computing, simply cannot move enough thermal energy to keep modern AI infrastructure within operating parameters.
The International Energy Agency reported that global data center electricity consumption reached approximately 415 terawatt-hours in 2024 and projected it could more than double to 945 terawatt-hours by 2030. To put that in perspective, that figure exceeds Japan’s entire annual electricity consumption. A significant portion of that energy—typically 30 to 40 percent in traditional facilities—goes directly to cooling.
Power Availability Is Reshaping the Data Center Map
The relationship between cooling and power has never been more critical. Data centers are now competing for electricity in ways that would have seemed impossible just five years ago.
Grid Strategies, a consulting firm tracking utility forecasting, found that five-year peak demand growth forecasts published by utilities jumped from 38 gigawatts in 2023 to 128 gigawatts in 2024—and that trajectory has only steepened since. In the PJM Interconnection territory, which spans from Illinois to North Carolina and hosts the nation’s largest concentration of data centers, peak load growth projections through 2030 attribute 30 gigawatts of new demand directly to data center expansion.
According to S&P Global’s 451 Research division, utility power demand from data centers reached approximately 62 gigawatts in 2025 and is projected to nearly triple to 134 gigawatts by 2030. Virginia alone accounts for over 12 gigawatts of that demand, followed by Texas at nearly 10 gigawatts.
These power constraints have extended construction timelines by 24 to 72 months in established markets and forced operators to explore locations they never previously considered. Cities like Kansas City, Minneapolis, Columbus, and emerging international markets have become viable data center locations specifically because they offer better access to electrical capacity. The new reality is simple: data centers go where the power is.
For facility operators, this means cooling efficiency isn’t just an operational concern—it’s a strategic imperative that directly impacts where facilities can be built and how quickly they can come online. Every watt saved on cooling is a watt available for computing.
The Clustering Challenge: When Data Centers Become the Biggest Consumer
The concentration of data centers in established markets creates compounding challenges. In Loudoun County, Virginia, data centers accounted for 21% of total power consumption in 2023, actually surpassing residential consumption at 18%. Across Virginia overall, data centers consumed approximately 26% of total electricity supply that same year—and that percentage has only grown.
This clustering creates reliability risks that operators must account for in their planning. In 2024, a minor electrical disturbance in Virginia’s Fairfax County caused 60 data centers to simultaneously switch to backup generation. The sudden loss of 1,500 megawatts—roughly equivalent to Boston’s entire power demand—nearly triggered widespread failures across the regional grid.
These incidents underscore why cooling system reliability is non-negotiable. When dozens of facilities compete for the same electrical resources, any cooling failure that forces increased power draw or triggers emergency protocols affects not just one facility but the entire regional infrastructure.
Technology Shifts: From Air to Liquid
The industry’s response to rising thermal loads has accelerated the adoption of liquid cooling technologies. By 2024, liquid-based cooling had captured 46% of the data center cooling market, and that share continues to grow as new AI-focused facilities come online. Industry analysts project liquid cooling will dominate new construction through the remainder of this decade.
Direct-to-chip cooling systems now use cold plates capable of handling heat flux exceeding 300 watts per square centimeter—thermal densities that air cooling simply cannot address. Immersion cooling, where servers are submerged in dielectric fluid, has moved from experimental deployments to production environments at hyperscalers including Meta and Microsoft.
This technological shift has significant implications for facility operators. Hybrid architectures that combine traditional air handling with liquid cooling loops have become standard in retrofit projects, allowing existing facilities to support higher-density workloads without complete infrastructure replacement.
However, these advanced systems require specialized expertise for installation, commissioning, and ongoing maintenance. The complexity of managing multiple cooling modalities—air handling, chilled water, direct liquid cooling, and potentially immersion systems—demands service partners with deep experience in industrial refrigeration applications.
Natural Refrigerants: The Sustainability Imperative
Environmental regulations are adding another dimension to cooling decisions. The AIM Act mandates an 85% reduction in hydrofluorocarbon production by 2036, with common refrigerants like R-410A banned from new equipment as of January 2025. Data center operators must now plan for refrigerant transitions that align with both regulatory requirements and sustainability commitments.
Natural refrigerants, particularly carbon dioxide (CO2) and ammonia, are gaining significant attention as sustainable alternatives. CO2 systems offer a compelling environmental profile with a global warming potential of just 1, compared to over 2,000 for many synthetic refrigerants like traditional Freon-based compounds. Ammonia systems, long proven in industrial applications, deliver exceptional thermodynamic efficiency for large-scale cooling loads.
While these refrigerants have been standard in industrial applications like food processing, cold storage, and agricultural facilities for decades, they’re increasingly being evaluated for data center applications where their environmental profile aligns with corporate sustainability goals and regulatory trajectories.
Operators considering natural refrigerant systems benefit from partnering with service providers who have existing expertise in ammonia and CO2 applications. The safety protocols, regulatory compliance requirements, and specialized maintenance procedures differ substantially from conventional HVAC refrigerants. Experience matters—and it’s experience that many traditional data center cooling contractors simply don’t have.
Compliance and Certification: A Growing Complexity
Data center cooling systems increasingly fall under regulatory frameworks that demand specialized knowledge. Facilities exceeding 35,000 square feet often trigger additional compliance requirements, and ammonia-based systems bring specific safety and reporting obligations regardless of facility size.
Industry standards from organizations including ASHRAE (American Society of Heating, Refrigerating and Air-Conditioning Engineers), the International Institute of Ammonia Refrigeration (IIAR), and the Refrigerating Engineers & Technicians Association (RETA) establish best practices that knowledgeable operators follow. Uptime Institute tier certifications, which many enterprise and colocation customers require, include specific provisions for cooling system redundancy and reliability.
For facility operators evaluating service partners, familiarity with these standards isn’t optional—it’s a baseline requirement. The consequences of non-compliance range from failed audits and lost certifications to regulatory penalties and, in worst cases, catastrophic system failures.
The Hidden Cost: Downtime in a 24/7 World
The financial stakes of cooling system reliability have never been higher. Industry research from 2024 and 2025 consistently shows that unplanned downtime costs large enterprises $300,000 or more per hour, with 41% of organizations reporting costs exceeding $1 million per hour during critical outages. For some Fortune 500 companies, costs can exceed $5 million per hour.
According to the ITIC 2024 Hourly Cost of Downtime survey, 97% of large enterprises with more than 1,000 employees report that even a single hour of downtime costs their organization over $100,000. When cooling systems fail and servers begin thermal throttling—or worse, shutting down entirely—those costs accumulate by the minute.
Cooling system failures consistently rank among the leading causes of data center outages. The 2024 Uptime Institute report found that power and cooling issues accounted for approximately 70% of significant outage incidents. For colocation providers, even a single major outage can trigger SLA penalties, customer churn, and lasting reputation damage that affects sales cycles for years.
This reality is driving increased investment in preventive maintenance programs, redundant cooling architectures, and partnerships with service providers capable of rapid emergency response.
What Forward-Thinking Operators Are Doing Now
The operators best positioned for the demands of 2026 and beyond share several characteristics. They’re investing in cooling infrastructure that can scale with increasing rack densities. They’re diversifying their cooling approaches to include liquid cooling capabilities alongside traditional air-based systems. They’re planning for refrigerant transitions before regulatory deadlines force rushed decisions. And they’re building relationships with service partners who understand industrial-scale refrigeration.
The data center industry’s growth trajectory shows no signs of slowing. Global data creation continues to accelerate, AI workloads are expanding across every sector, and the infrastructure to support this digital transformation must be built and maintained by skilled professionals who understand the unique demands of mission-critical cooling.
For facility managers and colocation operators navigating this landscape, the message is clear: cooling infrastructure is no longer a commodity. It’s a competitive differentiator that directly impacts uptime, efficiency, sustainability, and ultimately, the bottom line.
About IR Pros
Industrial Refrigeration Pros (IR Pros) brings over 30 years of experience in industrial refrigeration to the data center cooling market. With locations throughout the United States, factory-trained technicians, and deep expertise in ammonia and CO2 refrigeration systems developed through decades of work in food processing, cold storage, and agricultural applications, IR Pros delivers the reliability that mission-critical facilities demand. Licensed, insured, and committed to industry-leading safety standards, IR Pros provides design-build services, retrofit solutions, preventive maintenance programs, and 24/7 emergency response for data center operators who can’t afford downtime.
To learn how IR Pros can support your data center cooling requirements, contact us for a facility assessment.
References:
- Fortune Business Insights, “Data Center Cooling Market Size, Share | Forecast Report [2032],” 2025.
- Grand View Research, “Data Center Cooling Market Size | Industry Report, 2030,” 2025.
- Global Market Insights, “Data Center Cooling Market Size, Share & Forecast Report, 2034,” November 2025.
- S&P Global, “Data center grid-power demand to rise 22% in 2025, nearly triple by 2030,” October 2025.
- World Resources Institute, “Powering the US Data Center Boom: The Challenge of Forecasting Electricity Needs,” 2025.
- International Energy Agency, Data Center Energy Consumption Reports, 2024-2025.
- Pew Research Center, “US data centers’ energy use amid the artificial intelligence boom,” October 2025.
- ITIC, “2024 Hourly Cost of Downtime Survey,” 2024.
- World Economic Forum, “How data centres can avoid doubling their energy use by 2030,” December 2025.
- U.S. Department of Energy, “2024 Report on U.S. Data Center Energy Use,” Lawrence Berkeley National Laboratory, 2024.
