Fuel Cell for Data Center Market Research Report: Forecast (2024-2030)

Market Definition

Fuel cells run on electrochemical reactions where the oxidation of fuel (typically, hydrogen) takes place through an oxidizing agent (generally, oxygen) to produce electricity. The electricity produced from fuel is clean and doesn’t generate emissions.

Market Insights & Analysis: Global Fuel Cell for Data Center Market (2025-30):

The Global Fuel Cell for Data Center Market size was valued at around USD 175 million in 2024 and is projected to reach USD 400 million by 2030. Along with this, the market is estimated to grow at a CAGR of around 16% during the forecast period, i.e., 2025-30. The growth in the market is attributed to the rising awareness and growing emphasis on sustainability practices and lower greenhouse gas emissions globally. This is mainly due to the data center consuming massive electricity due to their prolonged uptime which leads to increasing levels of greenhouse emissions from the data centers. Moreover, these data centers rise in number due to the requirement of greater computing power and storage spaces. This development is primarily attributed to the increasing adoption of artificial intelligence and the rising global migration towards the cloud. The development of these scenarios highlights the worldwide demand for fuel cells as cleaner, emission-free sources of electricity for data centers.

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Apart from this, the growing number of data centers would further increase the electricity demand thereby increasing the load on electricity gridlines. This would prompt the data center companies to look for decentralized power sources for their data center, particularly for their small-scale data centers, as the power purchase agreement could limit the data center expansion. For instance, in the first half of 2024 in North America, several data center projects under completion were delayed due to shortages in the availability of power. The Central Statistics Office of Ireland highlighted that in 2023, the data center alone consumed around 21% of the country’s metered electricity. The consumption would further rise as EirGrid, the state-owned power transmission company of Ireland, expects the electricity consumption of data centers would rise to 31% by 2027.

Moreover, the increasing load on the gridlines globally due to data centers would result in power outages which provides fuel cells a huge opportunity to meet the demand as a backup power source in the data center worldwide.

Global Fuel Cell for Data Center Market Driver:

Increasing Focus on Sustainability & Emission Targets – The demand for the use of fuel cells in the data center is primarily driven by the global need to achieve sustainability goals and emission targets. This is because the data centers consume a significant amount of global electricity. The International Energy Agency (IEA) highlighted that around 1.5% of global electricity usage goes to data centers. The increase in electricity consumption is driven by the escalating adoption of artificial intelligence worldwide. Goldman Sachs expects that the rise in artificial intelligence's adoption will raise the power demand by 160% by 2030. This is mainly due to AI using more computing power. For example, a ChatGPT query requires around 2.9 Wh of electricity compared to just 0.9 Wh on a Google search. The increasing electricity consumption would result in an increase in global emissions by data centers.

IEA estimated that the data centers are responsible for about 1% of the worldwide greenhouse gas emissions related to energy, in 2020. The increase in data centers in the rapidly digitalizing world would further increase the emission of data centers. The unfolding of these scenarios coupled with the countries' policies regarding adopting sustainable practices to curb emissions would push the demand for fuel cells in the data centers.

Global Fuel Cell for Data Center Market Opportunity:

Adoption of Fuel Cell as Backup Power Source – The operations of the data centers significantly impact the electricity gridlines. This is primarily because the data centers consume a significant amount of global electricity. The demand for electricity in the data center is on a constant rise due to the increase in the number of data centers globally due to the rapidly growing digital landscape of the world. For instance, the demand for data centers which stood at over 55GW will rise to more than 170 GW by 2030, as per McKinsey.

Additionally, the rise in AI usage is also resulting in a rise in electricity demand due to the increase in demand for high-order computing power. For instance, according to Goldman Sachs, the rapidly growing AI adoption would result in around 200 TWh of electricity consumption every year till 2030. These scenarios result in high electricity consumption thereby leading to power outages. Data centers whose operation requires them to run constantly would result in a growing demand for reliable backup power sources. This would present fuel cells with healthy growth opportunities in the foreseeable future.

Global Fuel Cell for Data Center Market Challenge:

High Initial Investment Cost – The implementation of hydrogen fuel cells in data centers requires setting up the necessary infrastructure that involves the storage and supply of the fuel. The fuels used are highly inflammable substances and any carelessness would lead to severe consequences. Moreover, as the scale of data centers is getting bigger, it would further escalate the investment associated with their setup. These scenarios would deter companies from deploying fuel cells as a primary electricity source for their data centers given that traditional energy sources are much cheaper than fuel cells. These developments negatively impact the market dynamics of fuel cells in data centers thereby restricting their market growth & expansion.

Global Fuel Cell for Data Center Market Trend:

Pay as You Grow Model of Fuel Cell Deployment – Fuel Cells are technological innovation and reliable alternative electricity sources which is decentralized, particularly in case of power outages due to grid failure. Moreover, as sustainability measures are being implemented to curb greenhouse gas emissions, fuel cell emerges as a cleaner alternative. In addition to this, as a cleaner electricity source fuel cells are more reliable than wind and solar-based electricity as these electricity sources have intermittent or seasonal nature making them unreliable. While these aspects make usage of fuel cells a great electricity source, they are quite expensive to implement. Therefore, companies like; Bloom Energy, launch solutions like “Pay-As-You-Grow”, Bloom Energy deploys fuel cell modules to their customers and allows them to pay for what they use. They greatly help small data center operators and companies who cannot invest substantial capital into their limited scale of data centers.

Moreover, as these relatively smaller data centers scale up Bloom Energy would deploy additional modules of fuel cells. This development will drive market growth, particularly in the developing countries of Asia-Pacific, which are witnessing a boom in the number of data centers in the region but constrained by capital.

Global Fuel Cell for Data Center Market (2025-30): Segmentation Analysis

The Global Fuel Cell for Data Center Market study of MarkNtel Advisors evaluates & highlights the major trends and influencing factors in each segment. It includes predictions for the period 2025–2030 at the global level. Based on the analysis, the market has been further classified as:

Based on Fuel Cell Type:

• Proton Exchange Membrane Fuel Cells (PEMFC)
• Solid Oxide Fuel Cells (SOFC)
• Molten Carbonate Fuel Cells (MCFC)
• Phosphoric Acid Fuel Cells (PAFC)
• Others

The Proton Exchange Membrane Fuel Cells (PEMFC) hold more than 40% share in the Fuel Cell for Data Center Marker Worldwide. This is mainly due to the simplicity and time-tested reliability of the technology. The PFMFC is capable of operating with high efficiency due to its capability to quickly start and stop allowing the system to have low lead time. This aspect is crucially important for fuel cell usage in the data center which has high uptime. Moreover, this aspect makes them a great backup power source for the data center for larger who also want to lower their emission levels. For instance, Microsoft which plans to become carbon-negative by 2030, tested a 3MW prototype of a hydrogen fuel cell to its capabilities as reliable, emission-free backup power for data centers in 2022.

Furthermore, at the beginning of 2024, Microsoft and Caterpillar collaborated to test the hydrogen fuel cell by using it to power the data centers for 48 hours. Apart from this, Microsoft, in September 2024, announced that it will use a hydrogen fuel cell to power its data center in the Dublin campus, in Ireland in collaboration with ESB. This development highlights the PEMFC's rising demand which would fuel the market growth over the forecasted period.

Based on End Users:

• IT and Telecommunications
• Government
• Healthcare
• Others

The IT and Telecommunication sector holds the largest market share of more than 60% in the Global Fuel Cell for Data Center Market. This is primarily due to the IT and Telecommunication industry holding the largest data center capacity globally, for instance, the top big tech companies such as; Microsoft, Amazon, and Google own around 60% of the global hyperscale data center capacity. The rapid proliferation of artificial intelligence and deployment of 5G networks worldwide have further escalated the growth in the number of data centers in the IT and telecommunication industry. These scenarios make IT and Telecommunication the biggest end users for fuel cell demand.

Furthermore, as the world is rapidly digitalizing, data consumption is rapidly growing, as per the PWC, global data consumption is expected to reach about 10 million petabytes by 2027 from 3.5 million petabytes in 2022. The increase in data consumption, the greater demand for high-speed internet connectivity, and the migration of businesses to the cloud would fuel the rapid growth of data centers in the IT and telecommunication industry. The unfolding of these scenarios would fuel the market growth over the forecasted period.

Global Fuel Cell for Data Center Market (2025-30): Regional Projections

Geographically, the Global Fuel Cell for Data Center Market expands across:

• North America
• South America
• Europe
• The Middle East and Africa
• Asia-Pacific

North America dominates the market with a share of more than 50% in the Fuel Cell for Data Center Industry in 2024. This is primarily due to the region having more than 50% of the global data center capacity added by major technology companies originating from the region. Moreover, the supply of data centers in the primary market of North America jumped by 24% on a Y-o-Y basis to 1,100.5 MW, in the first half of 2024, as reported by CBRE. Additionally, the data center sites under construction have reached nearly 3,872 MW, which is a 69% year-on-year rise from the first half of 2023. The expansion of these data center capacities results from the rising migration towards the cloud and demand for greater computing power due to the adoption of artificial intelligence.

Furthermore, the big technologies plan to invest a significant amount to expand their data center capacity in the region, for example, in Q3 of 2024, Google announced its commitment to invest around USD 6 billion to expand its data center capacities in the USA. These scenarios highlight the region is likely to continue its dominance and fuel market growth over the foreseeable future.

Global Fuel Cell for Data Center Industry Recent Development:

• November 2024: Bloom Energy has signed a power supply agreement of up to 1 GW with American Electric Power.
• June 2024: ECL has announced that it has delivered the world’s first data center that uses hydrogen as its primary source at MV1, its facility in Mountain View, California.

Gain a Competitive Edge with Our Global Fuel Cell for Data Center Market Report

1. Global Fuel Cell for Data Center Market Report by MarkNtel Advisors provides a detailed & thorough analysis of market size & share, growth rate, competitive landscape, and key players. This comprehensive analysis helps businesses gain a holistic understanding of the market dynamics & make informed decisions.
2. This report also highlights current market trends & future projections, allowing businesses to identify emerging opportunities & potential challenges. By understanding market forecasts, companies can align their strategies & stay ahead of the competition.
3. Global Fuel Cell for Data Center Market Report aids in assessing & mitigating risks associated with entering or operating in the market. By understanding market dynamics, regulatory frameworks, and potential challenges, businesses can develop strategies to minimize risks & optimize their operations.

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