Immersion Cooling Market - Forecasts from 2024 to 2029

The immersion cooling market is projected to grow at a CAGR of 23.98% to reach US$1,427.887 million in 2029 from US$317.201 million in 2022.

Immersion cooling is the process of cooling hardware equipment such as batteries, motors, and computers by immersing them in a thermally conductive dielectric liquid. Mineral oils, synthetic oils, and fluoro-carbon-based fluids are the most used liquids for single-phase and double-phase immersion cooling purposes. In a single-phase immersion cooling system, the coolant is transported using a distribution unit installed to facilitate cooling using a heat exchanger unit.

In contrast, the coolant retains its liquid state. In contrast, in a two-phase cooling system, the coolant is initially vaporized, and later condenser coils are employed to restore the liquid form of coolants. The major factors stimulating the consumption of immersion cooling solutions are the growing cryptocurrency mining activities, increasing national data center capacity among major economies, and the thermal efficiency demand in electric vehicles.

Immersion cooling market drivers:

• Increase in the number of data centers

The growth in the number of data centers internationally and the evolution in their capacity is stimulating the demand for data centers. As per a report compiled by the North American data center, over 100 data center projects had either been announced or were in the initial process of being planned in the US as of 2021 with major operators and service providers such as Microsoft, Apple, Facebook, and Google accounting for approximately more than 90% of these data center projects. The adoption of immersion cooling systems aids data centers in lowering their energy consumption.

Further, the employment of immersion cooling can significantly increase the efficiency of energy usage by data centers. The International Energy Agency estimated that the workloads of data centers would increase by 260% to reach 650 million in 2021 from its initial value of 180 million in 2015, driven by the evolution of digital technologies. Therefore, the rise in data centers across major countries is a significant factor expected to promote the growth of the immersion cooling market over the forecast period.

• Rise in the production of electric vehicles

The International Energy Agency announced that the worldwide sale of electric vehicles was estimated at around 6.6 million in 2021. The rising demand for electric vehicles offers an opportunity for the expansion of the immersion cooling market since they are employed to cool the batteries of electric vehicles. Research tests conducted by Exoes's Lab revealed that using immersion cooling solutions to cool EV batteries prolongs battery life, enhances safety by lowering thermal runway accidents, and facilitates quick battery charging.

Furthermore, the increasing need for efficient thermal management to prevent battery fire accidents results in consideration of immersion cooling usage by EV manufacturers and chemical companies such as the Lubrizol Corporation and Ricardo PLC to let the battery be directly submerged in dielectric coolants. Therefore, the increasing need for effective battery cooling systems in electric vehicles is expected to drive the demand for immersion cooling systems over the forecast period.

Immersion cooling market challenges:

• The availability of alternative cooling solutions is impeding the market growth.

The presence of substitutes like conventional cooling systems limits the usage of immersion cooling solutions. However, the easy installation and fewer complications involved with adopting air-cooling products are promoting its use by the data centers of major technology companies such as Google, Meta, and Dell Technologies.

Further, air coolers have been one of the most dominantly used systems to cool data centers over the last decade. However, the upgradation to immersion cooling systems requires data centers to incur additional costs and make certain service infrastructure modifications, causing the continued use of air-cooling technology among certain data centers, leading to a slower growth of the immersion cooling market.

By application, the cryptocurrency mining segment is expected to contribute majorly to the development of the immersion cooling market.

The rise in cryptocurrency mining activities fueled by the release of new software platforms facilitating the cryptocurrency mining process and consumers' increasing focus on digital currency is resulting in high energy consumption by this sector. As a result, the international energy consumed for cryptocurrency mining increased by 300%, changing from 4 TWh in 2015 to approximately 100 to 140 TWh in 2021, as per the data released by the IEA.

This sector's massive surge in energy consumption results in high demand for immersion cooling systems to ensure the smooth functioning of computer systems.

Asia Pacific region holds a substantial share of the immersion cooling market and is expected to grow in the forecast period.

The enhancement in chip technology and server infrastructure is promoting the growth of regional data centers, creating an increased demand for immersion cooling solutions. For instance, the Indian government declared that the National Data Centre intends to accelerate the nationwide rise in scheduled data center capacity by installing 2000 MW by the end of 2027.

Further, the data center sector is expanding by investing in the region's leading companies such as Microsoft, Dell Technologies, and Samsung. For example, Amazon Web Services reported in November 2022 the opening of its second data center, AWS Asia Pacific Region, in India. Therefore, developing regional data centers is expected to drive the immersion cooling market.

Immersion Cooling Market Industry Updates:

• December 2022- Shell Lubricants announced its collaboration with Green Revolution Cooling Company as part of the ElectroSafe Fluid Partner Program initiated by the Green Revolution Cooling Company to enhance the quality of coolants and fluids used in immersion cooling systems single-phase type.
• September 2022- Dow Inc., a company in the materials science industry dedicated to providing customers with specialty solutions for infrastructure and packaging, introduced a new immersion cooling technology product, Dowsil, to provide sustainable and efficient cooling to large-scale enterprise and cloud data centers.
• August 2022- Gigabyte Technology Co. Ltd., a Taiwanese company producing computer hardware infrastructure, introduced new hardware solutions for immersion cooling purposes by collaborating with three major companies offering immersion cooling products, Asperitas, Submer, and GRC. The solutions introduced by the company include server models without fans and immersion-ready firmware.

Immersion Cooling Players and Products:

• GIGA-BYTE Technology Co., Ltd., immersion cooling- Implementing immersion cooling in an IT deployment strategy can be achieved using either a single-phase or two-phase cooling method. Immersion-cooled data centers offer scalability, increased speed, energy efficiency, cost savings for businesses, and overall greater reliability. It has applications including 5G, edge computing, enterprise data centers, and laboratory environment.

Immersion cooling market is segmented and analyzed as below:

By Type

• Single-Phase
• Two-Phase

By Application

• High-Performance Computing
• Edge Computing
• Cryptocurrency Mining
• Others

By Cooling Fluid

• Mineral Oils
• Synthetic Oils
• Fluoro-carbon-based Fluids
• Others

By Geography

• North America
• USA
• Canada
• Mexico
• South America
• Brazil
• Argentina
• Others
• Europe
• Germany
• France
• UK
• Spain
• Others
• Middle East and Africa
• Saudi Arabia
• UAE
• Israel
• Others
• Asia Pacific
• China
• Japan
• India
• South Korea
• Indonesia
• Taiwan
• Others