Market Trends of Taiwan Data Center Power Industry
IT & Telecommunication Segment Holds the Major Share
- Cloud and telecom are anticipated to contribute the largest market shares among end-user industries. Due to the increasing data generation, which drives the demand for quicker processing and effective servers, the cloud segment generates significant revenue. Numerous cloud service providers, including Cadence, Google, Siemens, Azure, AWS, and Synopsys, joined forces with TSMC to form a cloud alliance. Other big corporations also intend to enter the Taiwanese cloud industry in the future.
- As Taiwan develops into a regional hub for many enterprises, they are investing in cloud computing, thus increasing the demand for local data centers. The government is encouraging Taiwanese businesses to go digital. It is also dedicated to creating a cloud-based smart digital blueprint for local partners and connecting top-tier creative technologies for a variety of industries.
- For instance, Microsoft launched its “Reimagine Taiwan” program in 2020, outlining intentions to build its first cloud data center area in Taiwan and make large investments in local talent and development with the aim of supplying over 200,000 Taiwanese with digital skills by 2024.
- With an increase in smartphone users in Taiwan, the demand for telecom services is expected to grow. The Taiwanese electronics market has expanded due to the growing semiconductor sector. Taiwan currently produces close to 21% of the world’s semiconductors. Over the past few decades, Taiwan has dramatically improved its semiconductor output, becoming a prominent participant in the sector.
- The adoption of 5G services is projected to be accelerated by the rising need for high-speed data access for cloud and IoT applications, such as smart home energy management. However, as 5G networks offer faster speeds, higher capacity, and lower latency than 4G LTE networks, the number of 5G subscribers is growing at a quicker rate. In Taiwan, the total number of 5G customers surpassed 1 million in the five months after the introduction of the technology. At the end of 2023, Taiwan’s mobile network operator, MNO Chunghwa Telecom, increased 5G penetration by around 10%, reaching 35% overall.
- The use of digital consumer products such as smartphones and the data generated via them may allow telecom companies to securely manage and store large volumes of data and scale up the storage capacity as per their requirements. Such instances in the market create more demand for data centers, leading to rising requirements for data center power infrastructure in the region.
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Monitored PDUs Holds Significant Share in the Market
- Monitored rack PDUs are essential components in data center and server room infrastructure, providing real-time monitoring of power usage, voltage, current, and other electrical parameters. This data helps administrators make informed decisions about power allocation and capacity planning.
- By tracking power usage trends, administrators can plan for future growth and ensure that power capacity is not exceeded, preventing overloads that could lead to equipment failures. Moreover, it helps identify inefficiencies and optimize energy usage. This can lead to cost savings and a reduced environmental footprint by eliminating unnecessary power consumption. It also allows administrators for remote access and control, reducing the need for physical presence and minimizing operational disruptions.
- The increasing focus on digitalization, internet penetration (the number of Internet users reached 21.68 million users with 0.8% YoY in Taiwan as of January 2023), and e-commerce sales across the country creates more need for storage facilities, resulting in huge demand for data centers and a rise in power consumption. Growing demand for data storage has led to the deployment of intelligent power distribution units (PDUs) against simple multi-socket rack installations with server and network equipment, which optimize power consumption in data centers.
- The country has made clear progress in increasing competition in electricity and natural gas markets. It has reduced the use of fossil fuels and increased the share of renewable energy. The country’s economy is also becoming less energy-intensive. To further reduce energy consumption, the government is trying to achieve three ambitious targets by 2050: to reduce CO2 emissions by 50% between 2005 and 2050, the share of renewable energy should reach 20% in 2025, and a further phaseout of nuclear power will take place from 2025. In Taiwan, this has led to widespread support for introducing different policies to reduce energy consumption, installing smart systems, and reducing power consumption.
- Because of the above advancements mentioned with monitored PDUs and the necessity to reduce electricity consumption as per government measures in the country, key market players are focusing on introducing efficient power management systems. For instance, in May 2023, Eaton, which provides power management services, launched G3 Universal Input Rack PPDUs with dynamic C39 outlets capable of accommodating different plug configurations and input voltage requirements. To meet the most diverse data center rack power requirements, G3UPDU has added new features.
- In May 2023, Legrand, a significant global provider of electrical and digital building infrastructures, introduced the next generation of intelligent rack PDUs PRO4X and Raritan PX4. These new intelligent rack PDU designs revolutionize capacity planning, environmental monitoring, physical and digital access control, workload optimization, and uptime initiatives. Such developments in the segment are predicted to boost regional demand over the forecast period.
