Data center expected to reach USD 4.39 billion by 2029

The Middle East Data Center Construction Market was valued at USD 2.35 billion in 2023, and is expected to reach USD 4.39 billion by 2029, rising at a CAGR of 10.98%, according to Research And Markets.

The Middle East data center construction market is segmented into three parts- electrical infrastructure, mechanical infrastructure, and general construction. They are interconnected and interdependent. In a market such as the Middle East, cooling systems and techniques play a pivotal role due to the region’s harsh climatic conditions.

Crucial internal software and hardware such as servers, computing devices, and other equipment must cool down as they work incessantly to manage millions of data center operations daily. Therefore, to keep these up and running, proper power backup facilities such as UPS systems and generators are needed, with this region now focusing on sustainable ways to power them, such as using EcoDiesel, natural gas, biofuel, and other non-traditional sources. The facility also needs physical security and fire safety, ensuring the smooth running of the day-to-day activities without any external or internal threats.

Sustainable Initiatives on Rise
The Middle East is diverting its focus to a greener future that can be sustained in the long run, keeping the planet’s well-being in mind. The UAE, Saudi Arabia, Israel, Kuwait, Oman, and others are starting to use renewable energy sources such as solar, wind, and bioenergy for their facilities’ power needs. Implementing air-based cooling techniques is also rising to curtail water consumption further. UAE’s Moro Hub launched the largest solar-powered data center facility in Dubai, while Equinix’s newly launched DX3 facility in Dubai is said to be powered by 100% renewable energy.

The Age of Artificial Intelligence
Artificial Intelligence (AI) has taken the world by storm, and its future looks promising. Like other regions worldwide, the Middle East leaves no stone unturned to make AI happen. Almost every country in the region has an AI committee launching national AI strategies to promote its development and upskill its workforce, creating better technology and employment opportunities for its citizens. Data centers are aiding AI via high-performance computing (HPC), data storage, networking, and hosting specialized hardware. The UAE and Saudi Arabia lead on this front, using AI to control the power grid and distribution. It is also helping operators identify the best time to generate, store, and use the energy produced. This gives them the added benefit of handling power generation and supply remotely.

Smart City Developments
Smart cities are rising in the Middle East, with the UAE and Saudi Arabia leading. UAE’s Dubai and Abu Dhabi are among the world’s smartest cities, with a global smart city index ranking of 17 and 13, respectively. They have several existing and upcoming smart city initiatives. The NEOM is one of the world’s highly anticipated smart cities that will cost Saudi Arabia about USD 500 billion and is set to take the world by storm when it becomes operational by 2025. Research and Markets