Power challenge will drive data centre innovation

Legacy data centres face obsolescence as AI power density demands jump from 5 kW to 20 kW per rack.

Eduardo Fichmann · Factory Capital — Operating Partner1 April 2024Period: April 20244 min read

20 kW↑

Power density required per rack for AI workloads

3-5 kW→

Average power consumption per rack for traditional applications

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Abstract

This report analyses the critical energy challenges facing the data centre industry as it transitions to support high-density AI workloads. While the sector maintains double-digit growth, traditional facilities designed for 3-5 kW per rack are ill-equipped for the 20 kW requirements of modern AI hardware. The analysis explores emerging cooling technologies, the strategic shift toward renewable energy procurement to meet sustainability targets, and the rise of specialized platforms like Verrus that utilize dynamic power allocation and battery storage.

Key Takeaways

Data centre power density requirements are surging from a traditional 3-5 kW per rack to 20 kW for AI workloads.
The industry maintains double-digit growth but faces critical shortages in construction capacity and higher capital costs.
Legacy data centres risk lower floor utilisation as they hit power capacity limits before exhausting physical space.

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Frequently Asked Questions

Standard data centre racks are designed for 3-5 kW, but modern AI workloads require 20 kW per rack. This fourfold increase in power density necessitates a shift from traditional air cooling to liquid immersion technologies and dynamic power allocation.

Data centres currently rank in the top 5 for global investment activity and maintain a consistent double-digit annual growth rate. However, investors must account for higher capital costs and a shortage of construction capacity that threatens project timelines.

Legacy facilities face a sharp decline in floor utilisation as they reach their power capacity limits at just 3-5 kW per rack. These sites risk becoming stranded assets unless they undergo expensive retrofits to support the 20 kW requirements of AI hardware.

Sustainability mandates are driving a transition from diesel generators to grid-scale battery storage. This shift is critical for maintaining double-digit growth while meeting carbon reduction targets in high-density 20 kW environments.

Power challenge will drive data centre innovation

Abstract

Key Takeaways

Frequently Asked Questions

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