Offering you the level of certainty you need to make critical, real-time decisions to ensure the commercial success of your data center projects.
At RLB, our approach allows us to deliver successful outcomes to property and construction projects by tailoring our services to match client goals and needs. Our team specializes in creating, evaluating, and managing project controls that address the critical issues of time, cost, scope, and quality in the built environment. In this insight we cover the state of the sector domestically and abroad, trends, as well as what incentives to keep an eye out for before engaging in your project.
Things to watch out for
Data Centers in the United States
Enterprise companies such as Amazon, Microsoft, Meta, and Google are rapidly securing electrical power, land, and construction resources across the country to meet the anticipated demand for artificial intelligence (AI) capacity via new hyperscale data centers. Instead of acquiring space in existing or newly built colocation facilities, they are swiftly developing their own data center campuses.
Data center developers and owners are beginning to shift their focus away from major hubs such as Virginia and Silicon Valley, and are instead seeking secondary fiber locations like Chicago, Denver, Texas, and Georgia. The power requirements for AI clients have increased significantly, moving from megawatt capacities constructions to gigawatt capacities, resulting in a substantial impact on the United States’ energy consumption. Between 2018 and 2022, the power capacity used by data centers in northern Virginia has doubled to 2,767 megawatts. According to Dominion Energy, this growth in capacity comes with major transmission infrastructure, ultimately built to better serve the data center market.
Adversely, the industry is experiencing a reverse effect: copper prices rising due to the increased demand from data centers and other electrical uses, including renewable energy and electric vehicles.
A government-supported sector
Support from local and federal governments remains unchanged, for the most part. An exception to this is Georgia, where their local government have repealed incentives for data centers due to EPA regulations becoming more stringent for generators.
Trends
The surge of AI-powered services are increasing demand in the data center market, from lessees to developers. The demand correlates to higher energy consumption and expenditures for colocation and hyperscale additions globally. Power Usage Efficiency ratios are being improved by the introduction of smart power management solutions, allowing for more efficient cooling and power distribution to racks, which in turn enables higher rack density and revenue per rack. Cooling demands in turn are exacerbating the use of liquid cooling in data center facilities, supporting or entirely supplanting air-based cooling for increasing rack densities. These are often a substantial additional investment upfront for developers who are looking to maintain competitive rack densities while building new facilities in 2024.
About the charts
The map below represents the world’s data center construction market.
What’s driving the market
The surge of AI-powered services are increasing demand in the data center market, from lessees to developers. The demand correlates to higher energy consumption and expenditures for colocation and hyperscale additions globally. Power Usage Efficiency ratios are being improved by the introduction of smart power management solutions, allowing for more efficient cooling and power distribution to racks, which in turn enables higher rack density and revenue per rack. Cooling demands in turn are exacerbating the use of liquid cooling in data center facilities, supporting or entirely supplanting air-based cooling for increasing rack densities. These are often a substantial additional investment upfront for developers who are looking to maintain competitive rack densities while building new facilities in 2024.
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