Data center in Denmark: market size and trends

The rise of the data center in Denmark has been unquestionable in recent years. This trend is part of the unstoppable advance of data centers worldwide, driven by an increasing reliance on digital infrastructure to support industries, services and societies. 

While the demand for efficient and reliable data storage and processing facilities has skyrocketed globally, the Danish data center industry has emerged as a particularly attractive hub for further developing this field.

There are in fact several factors contributing to the appeal of Denmark’s data center market. Firstly, Denmark is renowned for the country’s commitment to transition towards renewable energy sources (particularly wind power). These efforts transcend the Danish data center industry, as the country has made significant milestones towards sustainable initiatives  such as the much-evolved  district heating in Denmark.

This has garnered attention from data center major players around the world, seeing Denmark as a favorable location to help them reduce their carbon footprint and align with sustainability goals. 

As we’ll see below in this article, this positions the Denmark data center market as a major innovative hub for developing circular, sustainable heating models that incorporate data centers.

But Denmark has more to offer than their commitment to sustainability: from a stable industry and a strategic location, to a cool climate conducive to efficient data center cooling, as well as supportive governmental policies to attract data center investment and digital innovation.

Meta, Apple and Google have already made major investments in developing their data centers in Denmark. As the European data center market approaches decisive years and with the rise of data centers in the Middle East, what is the foreseeable outlook for the Danish data center industry? Let’s take a look.

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Insights into the Danish data center industry

Figures by Arizton expect the Danish data center industry to grow from 1.73 billion in 2022 to 2.99 billion by 2028, at a CAGR of 9.48%. This same report expects the market size in area to reach 368 thousand sq. feet by 2028, as well as a power capacity of 77 MW (2028) 

The CAGR expected by Mordor Intelligence reaches 5.79% between the years 2024 and 2029, growing from an estimated 250.64 MW in 2024 to 332.09 MW by 2029. 

This same report identifies Tier 3 data centers to account for the majority share in 2024, with Tier 4 expected to take over between the years 2024 and 2029. At the same time, the firm identifies the top 5 companies in Denmark’s data center market to account for 34.79% of the share, so that the industry is described as “competitive (...) without dominant players”.

As we’ve mentioned above, good business and digital innovation prospects are proving attractive for data center investments in Denmark. In fact, the 2023 IMD World Digital Competitiveness Ranking sees Denmark in the 4th position. 

Favorable governmental measures to promote trade and investments in the digital economy have also stood out in recent years and made the Danish data center industry flourish. These include beneficial measures in terms of interest races and import licenses, as well as the appeal of the  Danish Special Economic Zones (SEZs)

All these growth expectations coincide with scholar research, such as the  paper entitled ‘The role of data centers in the future Danish energy system’ by Petrovich et.Al in 2020, which highlighted large-scale data centers could account for Denmark’s  33% electricity demand in 2040 when compared to national electricity consumption levels in 2017.

These and other figures highlight how the future of  the data center in Denmark (and around the world, for that matter) must present solid plans to address sustainability and energy efficiency.

Looking at this matter, Denmark has seen some remarkable examples of  good practices in terms of energy efficiency. First and foremost, Denmark's northern location means it has created multiple free cooling opportunities, a highly-efficient  method that employs outside air to cool data center equipment without the need for mechanical refrigeration. 

Secondly, in 2023 a data center in Denmark was the first one to provide submerged cooling or liquid immersion cooling in Europe, leading to a reduction in power consumption for cooling by up to 90%. Liquid immersion cooling can be up to 1000 times more effective than air-cooling techniques and stands out among the data center cooling solutions of the future.

Emerging patterns: trends for the data centers in Denmark 

Data centers in Denmark fueling sustainable district heating

The use of excess heat generated by data centers to provide warmth for district heating systems will become more and more prevalent, powered by a recent political agreement. As an example of Denmark's innovative approach to sustainability, the idea is to repurpose waste heat that would otherwise be lost.

The new rule aims at facilitating this process by reducing administrative burdens and ensuring favorable conditions for district heating operators. The result is expected to promote eco-friendly urban development that incorporates the benefits of a developed Danish data center industry and an evolved district heating infrastructure.

DCIM for enhanced operations

Data Center Infrastructure Management is poised to assume a pivotal position in models for the future data center in Denmark. These technological tools generate the optimization and centralization of a digital ecosystem within data centers,  facilitating decision-making and resource allocation. 

The result are data centers that see their processes streamlined and their performance enhanced, all with the aim of achieving greater cost-effectiveness and efficiency.

Towards total reliability 

The Danish data center industry advances towards a total redundancy and complete fault tolerance, with Tier 3 and Tier 4 segments dominating the market today and in the future. An uptime guarantee of 99.982% as well as these models’ cost-effectiveness and energy efficiencies mean their prevalence can be expected in the future.

Advancing energy efficiency initiatives

As seen throughout the whole text, data centers in Denmark must necessarily embrace energy efficiency due to the immense consumption associated with their operations. As such, the current and future outlook will see widespread efforts towards achieving energy-efficient design and strategies for reducing energy demand.

This is precisely where efficient data center cooling comes in. There are a number of initiatives that are setting the foundations for what efficient data center cooling will look like in the coming years, including but not restricted to liquid immersion cooling.

Not surprisingly, designing the best data center cooling system depends on an expert evaluation that can  take into account energy and cost efficiencies in each particular data center. Additionally, installation, maintenance and management requirements must also be considered, in an integral approach that ensures the maximal potential for each project can be reached.

All in all, the  green data center is set to dominate the Danish data center industry in the coming years, as energy efficiency translates into both sustainability and cost-efficiency. 

At ARANER, we offer state-of-the-art thermal engineering to develop the data centers of the future in Denmark and beyond. Through our innovative data center cooling solutions, we devise and implement the right cooling solution for each project, focusing on both environmental and economic advantages. 

This has led us to successfully implement modern and efficient data center cooling solutions across the globe, including such challenging conditions such as our data center cooling project in  the Al Ashghal complex

Situated in a challenging location in terms of extreme temperatures, our cooling design introduced trailblazing solutions for enhanced efficiency, including a Thermal Energy Storage (TES) system.

Want to learn more about our work as undisputable leaders for data center cooling solutions? Download our data center reference book or get in touch with us and speak to our team about how we can help you.

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