One of the joys as a kid playing with a Magic 8 Ball is if you asked a question and didn’t like the answer, you could shake it up and ask again for a different answer.
The Magic 8 Ball had 20 different answers but when we gaze into the data center industry’s crystal ball for 2025 trends, we only see one answer, no matter how many times we shake it: artificial intelligence!
Generative artificial intelligence to be more exact is not just a game changer but is being touted by the World Economic Forum as a once in a 50-year technical revolution that could be society’s new equalizer.
From Deloitte (As generative AI asks for more power, data centers seek more reliable, cleaner energy solutions) to JLL (AI and the green energy transition will bring new challenges and opportunities) the story going forward is AI and the shockwaves it is sending through the data center industry.
“Today, Artificial Intelligence (AI) is pushing data centers to their limits due to the massive amount of generated data,” reports Fast Mode. “Despite challenging the boundaries of data centers, AI also serves as an asset for data center development and operations, unlocking benefits that were not accessible five or ten years ago.”
What kind of pressures are data centers under going into 2025: Oxford Economics and Cognizant forecasts that generative AI in the US could add as much as $1 trillion to the US gross domestic product and boost worker productivity by 10 percent by 2032.
To reach this level, data centers are going to have to ramp up more computing power putting the focus on bigger campuses, greater demand for more energy and advanced cooling systems, and a diet that includes a lot more fiber – fiber optic cables that is!
Here’s a closer look at data center trends for 2025.
AI Demands More Power and Sustainable Energy Solutions
AI’s appetite appears insatiable for power and the data center industry must find ways in 2025 to cope with these growing demands.
As NPR reported, as the technology advances, the electricity and water demand for the computing that powers AI has ballooned worryingly.
“We’re starting to see industrial-scale challenges for power supply,” data scientist Jakub Kraus from the Center for AI Policy in Washington, DC, told NPR, who notes that big tech companies are now turning to nuclear power to fill their voracious energy needs.
JLL notes that the European Commission estimates that the electricity consumption of data centers will increase by 60 percent by 2030 while power generation capacity needs huge investment to meet renewable energy targets.
Deloitte predicts that power-intensive generative AI training and inference will roughly double the global data center electricity consumption by 2030.
“It’s an uphill task for power generation and grid infrastructure to keep pace with a surge in electricity demand from AI data centers,” says Deloitte. “Electricity demand was already growing fast due to electrification—the switch from fossil-fueled to electric-powered equipment and systems in the transport, building, and industrial segments—and other factors.”
Deloitte sees the AI tsunami causing these ripple effects in 2025:
- Hyperscalers will continue to build massive facilities: To meet the AI computing demand, Deloitte expects capital expenditure off major hyperscale data centers to reach a record $220 billion by 2025, up from $200 billion this year.
- Alternative forms of energy will need to be sourced: Data center operators need to find new forms of cooling, and more energy-efficient solutions when designing data centers in 2025 to meet these surging power demands.
- Look for more regulations from local authorities: Data center’s drain on local power grid has caught the eyes of authorities and some have responded with regulations. In Ireland, for example, data center construction of new facilities connected to the grid was halted (but later reopened) and the city of Amsterdam halted new data center construction to support sustainable urban development. Look for jurisdictions to put new sustainability demands on local data centers.
- Data centers and clean energy: Not only can data centers take advantage of clean energy to meet power demands, but utilities are taking advantage of AI to enable their grids to operate more efficiently and reliably. Data centers and AI look to play a key role in 2025 in the shift to clean energy across the globe.
- Data centers will increase appetite for water too: Denser racks packed with power-hungry chips will increase data center’s demand for water in 2025. Deloitte says that AI data centers freshwater demand could be as much as 1.7 trillion gallons by 2027. Liquid cooling appears to be an answer that could one day reduced power usage compared with air-based cooling methods.
- Move towards sustainable solutions and carbon-free sources: AI data centers will make purchase agreements and long-term contracts with renewable energy providers as they look for sustainable solutions.
“The holistic efforts of hyperscalers and electricity providers to help increase the use of carbon-free sources to power data centers—including the ones being built exclusively for gen AI—may bear fruit in the longer term,” concludes Deloitte.
Eat More Fiber! Digital Twins, Rethinking Site Locations and Other Trends
2025 promises to see more data centers “add fiber to their diet” (as in fiber optic cables!) as AI, 5G and other connective devices spur facilities to upgrade for 400G, 800G and 1.6TB data centers of the future.
“This incredibly huge amount of data equates to incredibly fast rates of transmission. As we embark on a transmission trajectory set towards 1.6Tbps through 400G and the impending 800G, data centers are pressed to adapt and upgrade their infrastructure, quickly yet reliably,” wrote Nicholas Cole in Data Center Frontier. “However, this transition is not just about swapping out old equipment for new; it involves a meticulous compatibility and interoperability process to ensure that all components work seamlessly together.”
The density of fiber in data centers will increase exponentially as AI ramps up computing demands on campuses.
Other trends to look for in 2025 include:
- Digital Twins Show Results: Digital simulation projects for optimizing the energy efficiency of data centers are starting to show results,according to Data Center Dynamics.
- Heat Reuse on Tap: Data centers will increasingly implement heat reuse technologies to improve energy efficiency and sustainability, with innovations like using waste heat to power greenhouses, dehydrate commodities, or provide heating for nearby buildings and communities.
- Tight Labor Market: The data center industry will face significant staffing challenges, with a projected need for 2.3 million full-time employees globally by 2025 (via Uptime Institute), leading to increased focus on recruiting skilled tradespeople and leveraging temporary labor to meet dynamic workforce demands.
- Cybersecurity (and Physical Security) Threats: Data centers will confront more sophisticated cyber threats, including "living off the land" attacks and triple extortion schemes, while also enhancing physical security measures through advanced entrance control systems and multi-layered verification processes.
- Integrated Lifecycle Analysis (LA) Approach: Data centers will adopt a more holistic approach to sustainability, moving beyond energy consumption to consider the entire environmental footprint of facilities, including materials, construction, and end-of-life management, guided by integrated Lifecycle Analysis methodologies.
- Diversification of Location Sites: Data center operators will increasingly explore diverse location strategies, moving beyond traditional hubs to rural areas and emerging markets. This trend will be driven by factors such as lower energy costs, colder climates for natural cooling, and the potential for on-site renewable energy production.
- Working on Acceptability in Communities: Data center companies will focus more on improving their acceptance in local communities and becoming “good neighbors”. This will involve addressing concerns such as noise pollution, visual impact, and resource consumption. Operators will likely engage in community outreach programs, adopt more aesthetically pleasing designs, and implement sound mitigation measures to reduce noise.
Hexatronic Data Center can support your projects from the design phase to on-site managed services. Contact us today to learn more about our wide array of specialized data center services.
