Study Of Data Center Water Consumption In Japan

Study Of Data Center Water Consumption In Japan Market Analysis

The Study Of Data Center Water Consumption In Japan Market size is estimated at 89.02 billion liters in 2025, and is expected to reach 121.97 billion liters by 2030, at a CAGR of greater than 6.5% during the forecast period (2025-2030).

• IT Load Capacity: The IT load capacity of Japan's colocation data center market is around 1,688.6 MW in 2024.
• Geographical Significance: Japan has four distinct seasons, with a climate ranging from subarctic in the north to subtropical in the south. The Pacific and Sea of Japan sides differ. Northern Japan has warm summers and very cold winters with heavy snow. Eastern Japan has hot, humid summers and cold winters with heavy snow. Western Japan has very hot, humid summers (sometimes reaching 35°C) and moderately cold winters. Okinawa and Amami have a subtropical oceanic climate with hot, humid summers (rarely reaching 35°C) and mild winters. Japan aims for carbon neutrality by 2050 and is actively working to conserve and optimize water usage across all sectors, including data centers.
• Raised Floor Space: Japan's colocation data center raised floor space is about 6.06 million sq. ft in 2024.
• Projected Installed Racks: In 2024, Japan is set to have approximately 241,222 installed racks in its colocation data centers.

Study Of Data Center Water Consumption In Japan Market Trends

Japanese Colocation Facilities See Surge in Demand Driven by AI

• Japan's overall IT capacity as of 2024 is about 1,688.5 MW, and is projected to increase during the forecast period.
• Key players in this market encompass a mix of global and local data center operators, including Equinix Inc, NTT DATA Inc, Digital Realty Trust Inc, NEC Corporation, and IDC Frontier Inc. (SoftBank Group), among others.
• Japan's AI systems market has surged to around $4.5 billion, marking a robust year-on-year growth rate of 35.5%. This growth can be largely attributed to a diverse array of companies in Japan embracing digital transformation (DX) and increasingly integrating AI as a core technology. Furthermore, Japan’s Ministry of Internal Affairs and Communications (MIC) forecasts that the AI systems market in Japan is set to expand to an estimated $7.3 billion by 2027.
• According to government projections, Japan's energy demand is set to rise by 35% to 50% by 2050. This surge is primarily fueled by the growing energy needs of semiconductor factories and data centers that bolster artificial intelligence (AI) operations. Consequently, this heightened demand will render Japan's data centers increasingly water-intensive, resulting in a notable uptick in water consumption.

Japan Sees Surge in Mega Data Center Facilities Amid Ongoing Investments

• Hyperscale tech giants, including Microsoft Corporation, among other data center operators, are bolstering their investments in AI and Japanese data centers, driving heightened demand within the nation.
• In response to Tokyo's drive for enhanced computing power for artificial intelligence, Microsoft is set to make its largest investment in Japan, pouring $2.9 billion into data centers by 2025.
• Amid concerns over domestic data being transferred and stored in overseas data centers, Tokyo is implementing measures to bolster the country's AI computing power. In a related move, Microsoft is set to install advanced AI semiconductors at two of its existing sites located in eastern and western Japan.
• As online shopping platforms gain traction, small businesses are increasingly adopting online payment methods and establishing a digital footprint in the e-commerce landscape. Meanwhile, larger, established companies are seamlessly blending e-commerce with their traditional business models. In 2022, Japan boasted 107.1 million smartphone users. Projections indicate a steady growth, with a CAGR of 1.3%, anticipating the user base to hit 117.77 million by 2029.

Study Of Data Center Water Consumption In Japan Industry Overview

• Five major companies dominate the moderately fragmented Japanese water consumption data center market. Equinix Inc, NTT DATA Inc, Digital Realty Trust Inc,IDC Frontier Inc. (SoftBank Group), and NEC Corporation are at the forefront of this market.
• Equinix is actively pursuing water positivity through various initiatives, such as utilizing fuel cells to conserve billions of gallons of water, harnessing deep lake water cooling, implementing Aquifer Thermal Energy Storage (ATES) alongside free air cooling to cut down power consumption, and more.
• Digital Realty has teamed up with Ecolab, a global frontrunner in water, hygiene, and infection prevention solutions, to roll out a cutting-edge AI-driven water conservation initiative across 35 of its U.S. data centers. The pilot, executed by Nalco Water – Ecolab’s specialized water and process management division – seeks to boost water efficiency at Digital Realty and reduce its environmental footprint. The company is set to implement similar initiatives at its Japanese data centers and others worldwide too.

Study Of Data Center Water Consumption In Japan Market Leaders

Study Of Data Center Water Consumption In Japan Market News

• May 2023: In Japan, data center providers KDDI and NTT DATA are exploring liquid immersion technology to reduce energy wasted on cooling server hardware.
• July 2024: As ESG considerations gain prominence and the 2040 carbon neutrality target looms, energy efficiency has become paramount for power-hungry data centers. To enhance energy metrics, leveraging advanced technologies and formulating actionable sustainability strategies based on established carbon baselines are essential. Notably, Equinix's TY15, set to debut in Tokyo in September 2024, is an AI-driven data center. It will kick off with 1,200 cabinets and will be powered entirely by renewable energy.