Japan Green Data Center Market Research Report

Japan Green Data Center Market Size and Share:

The Japan green data center market size was valued at USD 5.59 Billion in 2024. Looking forward, IMARC Group estimates the market to reach USD 23.35 Billion by 2033, exhibiting a CAGR of 17.21% from 2025-2033. The market is experiencing rapid growth driven by increasing demand for sustainable IT infrastructure. Rising energy consumption, stringent environmental regulations, and a push toward carbon neutrality are the key factors propelling the market further across Japan.

Key drivers in Japan's green data center market include the country's strong commitment to sustainability and carbon neutrality. With Japan aiming to achieve net-zero emissions by 2050 businesses are increasingly focused on reducing their environmental footprints. This has led to a surge in demand for energy-efficient technologies such as renewable energy integration, advanced cooling systems, and low-power hardware. For instance, in May 2024, AirTrunk officially opened its second Tokyo data centre TOK2 capable of over 110 MW enhancing cloud services in the region. Committed to sustainability it features low power usage effectiveness and supports local education initiatives.

Another significant driver is the growing demand for digital services and cloud computing which require robust data infrastructure. As Japan's digital economy expands the need for data centers to handle massive data volumes increases. With energy costs rising and environmental concerns intensifying companies are prioritizing energy-efficient solutions to meet both operational and environmental goals. For instance, in November 2024, NTT launched advanced liquid cooling technology in Japan through two initiatives: a new verification facility in Noda for testing various cooling systems and a trial of two-phase direct-to-chip cooling in an air-cooled data center in Tokyo aiming to enhance efficiency and reduce CO2 emissions in existing facilities. Additionally, Japanese consumers are becoming more environmentally conscious influencing businesses to adopt greener practices to attract eco-conscious clients and partners.

Japan Green Data Center Market Trends:

Rising Focus on Carbon Neutrality

Many data center operators in Japan are increasingly committing to carbon neutrality driven by the nations ambitious goal of achieving net zero emissions by 2050. To meet these targets data centers are prioritizing energy efficient operations such as optimizing power usage effectiveness (PUE) and incorporating renewable energy sources like solar, wind and hydropower into their energy mix. Additionally, operators are investing in carbon offset programs utilizing green building materials and adopting sustainable technologies such as AI-driven cooling systems. For instance, in July 2024, NTT Facilities introduced a next-generation data center project focused on carbon neutrality. By implementing advanced liquid cooling systems energy consumption for cooling could decrease by 50%. The design emphasizes efficiency, community integration and innovative cooling methods promising a smaller environmental footprint while supporting the growing demand for digital infrastructure. By aligning with the increasing demand for sustainable and environmentally responsible IT infrastructure, these efforts contribute to reducing carbon footprints.

Rising Adoption of AI and Automation for Resource Optimization

Artificial intelligence and machine learning are transforming data center operations by enabling real-time monitoring and optimization of energy usage. AI algorithms can predict workload demands, thereby automatically adjusting cooling systems, server loads and power distribution to minimize energy consumption without compromising performance. Machine learning models continuously analyze operational data to identify inefficiencies, detect potential failures and recommend improvements. For instance, in August 2024, Singtel announced its partnership with Hitachi to develop advanced AI data centers in Japan leveraging Singtel's connectivity and data expertise alongside Hitachi's sustainable technology solutions. This collaboration aims to enhance digital innovation across the Asia Pacific while exploring GPU cloud services and sustainable practices in data management and operations. This dynamic and data-driven approach lowers costs, reduces waste, and enhances sustainability by optimizing resource utilization.

Increased Adoption of Renewable Energy

Data centers in Japan are increasingly shifting to renewable energy sources such as solar, wind, and hydroelectric power to align with sustainability goals and reduce environmental impact. This transition is driven by the need to lower carbon footprints and comply with Japan’s ambitious carbon neutrality targets. By integrating renewable energy into their operations data centers not only reduce their reliance on conventional grid electricity but also contribute to the country’s overall efforts to promote clean energy. For instance, in July 2024, AT TOKYO Corporation finalized an off-site power purchase agreement with Advance Maintenance and TEPCO EP to supply renewable energy to its Data Center #3.  The growing availability and cost-effectiveness of renewable energy technologies are making it more feasible for operators to power their facilities sustainably while maintaining operational efficiency.

Japan Green Data Center Industry Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the Japan green data center market, along with forecasts at the regional and country levels from 2025-2033. The market has been categorized based on component, data center type, industry vertical, and region.

Analysis by Component:

• Solutions
  • Power Systems
  • Servers
  • Monitoring and Management Systems
  • Networking Systems
  • Cooling Systems
  • Others
• Services
  • System Integration Services
  • Maintenance and Support Services
  • Training and Consulting Services
     

In Japan's green data center market solutions focus on integrating energy-efficient technologies that reduce environmental impact while maintaining high performance. These solutions encompass power systems, servers, monitoring and management systems, networking systems, cooling systems and other components. Power systems utilize renewable energy and advanced energy storage to minimize carbon footprints. Servers are optimized for lower energy consumption leveraging virtualization and energy-efficient processors. Monitoring and management systems enable real-time tracking and optimization of energy use. Networking solutions reduce power consumption through energy-efficient components while advanced cooling systems ensure optimal temperatures with minimal energy. These solutions aim to enhance operational efficiency and sustainability across data center infrastructures.

Services in Japan's green data center market support the deployment, maintenance and optimization of sustainable data center operations. These services include system integration, maintenance and support and training and consulting. System integration services focus on seamlessly integrating energy-efficient technologies into existing infrastructure. Maintenance and support services ensure the ongoing efficiency of systems using predictive analytics and preventive maintenance to reduce downtime and energy waste. Training and consulting services provide businesses with the expertise needed to operate and optimize green data centers effectively from selecting the right technologies to implementing best practices for energy conservation. These services are vital for ensuring data center sustainability and compliance with environmental goals.

Analysis by Data Center Type:

• Colocation Data Centers
• Managed Service Data Centers
• Cloud Service Data Centers
• Enterprise Data Centers
   

Colocation data centers in Japan offer a shared environment where businesses can lease servers, storage and networking equipment benefiting from robust security, cooling and power systems. This arrangement allows companies to lower their capital expenses by outsourcing the management of their infrastructure. In Japan, colocation centers are increasingly adopting green initiatives that focus on utilizing renewable energy sources and applying energy-efficient cooling and power systems. This approach helps businesses achieve sustainability targets while ensuring their data center operations are reliable, scalable and compliant with regulations.

Managed service data centers in Japan provide a full suite of IT infrastructure management services including server upkeep, security and data backup all while promoting energy efficiency. These centers cater to businesses that require professional oversight of their IT environments without depending on in-house resources. They also emphasize sustainable practices by incorporating energy-saving technologies and renewable energy sources. This focus aims to reduce environmental impact while ensuring optimal performance, reliability and adherence to Japan's green standards for data centers.

Cloud service data centers in Japan deliver flexible and scalable computing resources via various cloud platforms including IaaS, PaaS and SaaS options. Utilizing virtualization technologies these centers enhance resource usage helping companies to decrease their energy requirements. Japan's cloud service data centers are committed to sustainability adopting renewable energy sources, efficient cooling systems and power efficient infrastructures. By implementing environmentally friendly practices these data centers enable businesses to expand their IT resources while limiting their ecological impact aligning with Japan's dedication to ecofriendly innovation.

Enterprise data centers in Japan are owned and managed by large corporations to oversee their IT infrastructure and critical applications. There is a growing focus on sustainability within these centers which are embracing energy efficient technologies such as AI driven optimization and renewable energy integration. The objective of Japan's enterprise data centers is to reduce energy consumption and carbon emissions through advanced cooling systems, power management and resource allocation practices. This setup allows businesses to maintain control over their IT environments while actively contributing to Japan’s green initiatives aimed at minimizing the environmental footprint in the data center sector.

Analysis by Industry Vertical:

• Healthcare
• BFSI
• Government
• Telecom and IT
• Others
   

In Japan's healthcare industry green data centers are essential for handling sensitive medical information, enhancing patient care and facilitating healthcare operations. These facilities prioritize energy-efficient technology and adhere to strict data security protocols and compliance with laws like Japan's privacy regulations. They implement green practices such as utilizing renewable energy and sustainable cooling methods to reduce their environmental impact while providing a dependable infrastructure for electronic health records, telemedicine and healthcare analytics.

The banking, financial services and insurance (BFSI) sector in Japan depends significantly on green data centers for safe and effective management of financial transactions, customer data and regulatory compliance. These centers emphasize sustainability through innovative power management, virtualization and sourcing renewable energy. By utilizing energy efficient cooling and backup technologies Japan’s BFSI data centers lower operational costs and reduce their carbon emissions. The implementation of secure and scalable cloud solutions fosters the growth of the financial sector while aligning with environmental and sustainability goals in data management.

Japan's government sector is increasingly embracing green data centers to improve public service delivery while reducing environmental effects. These centers handle vital government information, including public records, tax systems and e-governance frameworks. Sustainability is a fundamental objective with measures such as integrating renewable energy developing energy-efficient infrastructure and employing environmentally friendly cooling systems. By focusing on green technologies government data centers contribute to Japan's climate objectives while ensuring dependable, secure and efficient service delivery in the public sector.

The telecom and IT sectors in Japan heavily depend on green data centers to meet the rising demand for communication services, cloud computing, big data and IoT solutions. These facilities prioritize sustainability by using energy efficient servers networking hardware and storage options while maximizing power efficiency through advanced cooling methods. By incorporating renewable energy sources and intelligent resource management strategies Japan's telecom and IT data centers work to lower their carbon footprint. This transition helps meet environmental targets while ensuring high performance, security and dependability for digital and communication services.

Regional Analysis:

• Kanto Region
• Kansai/Kinki Region
• Central/ Chubu Region
• Kyushu-Okinawa Region
• Tohoku Region
• Chugoku Region
• Hokkaido Region
• Shikoku Region
   

The Kanto region which includes Tokyo is the most extensive and developed market for green data centers in Japan. It acts as a central point for technology firms, financial institutions and government bodies that need energy efficient and sustainable data infrastructure. The green data centers in this area focus on incorporating renewable energy, implementing innovative cooling techniques and utilizing energy-efficient servers. With its advanced infrastructure, significant demand for data services and commitment to environmental sustainability Kanto stands out as a key player in Japan's green data center landscape.

The Kansai/Kinki region with Osaka at its heart is increasingly recognized as a crucial player in Japan's green data center market. This area boasts a robust industrial sector that includes finance, manufacturing and IT services is making significant strides in adopting sustainable technologies for data center operations. Green data centers in Kansai are equipped with energy efficient systems, harness renewable energy sources and implement innovative cooling methods to lessen their environmental impact. As demand from various sectors rises and regional government support grows the Kansai region is well on its way to becoming a leading hub for ecofriendly data infrastructure.

The Chubu region home to cities like Nagoya is becoming an important contender in Japan’s green data center landscape. The area's strong manufacturing and technology sectors are driving the urgent need for sustainable data infrastructure. Chubu’s green data centers prioritize energy efficiency by utilizing cutting edge cooling systems, energy-saving hardware and sourcing renewable energy. With access to advanced industrial resources and a pledge to green initiatives Chubu is shaping up to be a prime location for businesses looking for environmentally responsible data solutions.

Located in southern Japan the Kyushu-Okinawa area is making strides in the green data center market. Its strategic positioning access to renewable energy sources such as solar power and commitment to sustainability attract eco-friendly companies. Green data centers in Kyushu-Okinawa emphasize carbon emission reduction and energy efficiency through intelligent infrastructure and renewable energy integration. With increasing investments in digital transformation this region is poised for ongoing growth in the green data center sector benefiting both local and international enterprises.

The Tohoku region in northeastern Japan is cultivating its green data center market spurred by relatively low land costs and plentiful natural resources including hydroelectric power. The focus is on sustainable data center solutions that feature renewable energy sourcing and energy efficient cooling methods. Tohoku's green data centers benefit from local government support for ecofriendly infrastructure reflecting an emphasis on regional revitalization. This makes the area appealing for companies seeking to cut costs while aligning with sustainability objectives.

Located in western Japan the Chugoku region is gradually positioning itself as a significant player in the green data center market. The focus is on implementing energy efficient technologies to meet the rising demand for IT services and digital infrastructure. Chugoku’s green data centers combine renewable energy sources such as solar and wind power with sustainable cooling and power management strategies. The region's commitment to green initiatives is attracting more businesses to establish sustainable operations contributing to Japan's broader environmental goals.

Japan’s northernmost region Hokkaido is becoming increasingly relevant in the green data center market due to its cool climate and access to abundant renewable energy sources such as wind and geothermal power. These characteristics provide a significant advantage in lowering energy consumption especially in cooling systems. In Hokkaido, green data centers aim to harness renewable energy and sustainable infrastructure to lessen their environmental impact. The region's dedication to ecofriendly practices and its role as a renewable energy hub make it an appealing location for businesses that prioritize sustainability.

On the smallest of Japan's main islands the Shikoku region is gradually building its green data center market. Although not as prominent as other areas Shikoku takes advantage of its access to renewable energy resources like hydropower and solar energy. Data centers in Shikoku are focused on ecofriendly infrastructure incorporating energy efficient cooling systems and low carbon power sources. The region's commitment to green initiatives along with increasing investments in digital infrastructure is fostering the greater adoption of green data centers consequently contributing to Japan’s overarching sustainability objectives.

Competitive Landscape:

The competitive landscape of Japan’s green data center market is characterized by a blend of local and global players all vying to meet the rising demand for sustainable IT infrastructure. Companies are differentiating themselves through innovative energy efficient technologies such as renewable energy integration, advanced cooling systems and AI-powered resource optimization. Key factors influencing competition include compliance with stringent environmental regulations, the ability to offer scalability and cost-effectiveness in green energy sourcing. As sustainability becomes increasingly vital to clients, providers with strong green credentials and transparent energy usage reporting gain a competitive advantage. For instance, in October 2024, Ubitus, a Japanese tech firm announced its plans to construct a new 40MW data center near a nuclear power plant seeking sites in Kyoto, Shimane or Kyushu. Company emphasized the need for reliable energy for AI applications highlighting nuclear power's competitiveness. Moreover, the market is seeing strategic partnerships with renewable energy suppliers and collaborations to develop ecofriendly infrastructure. This dynamic environment is fostering rapid innovation as data center operators race to offer cutting-edge solutions that align with environmental and business needs.

The report provides a comprehensive analysis of the competitive landscape in the Japan green data center market with detailed profiles of all major companies.

Latest News and Developments:

• In May 2024, NEC launched two new green data center buildings in Kanagawa and Kobe, Japan utilizing 100% renewable energy. Capable of handling over 20kW per rack these centers respond to rising demand and feature advanced designs for managing high waste heat from integrated computing.
• In February 2024, Yondr Group announced its partnership with Marubeni Corporation to develop data centers in Japan starting with a hyperscale facility in West Tokyo. This collaboration aims to enhance renewable energy access for data centers and supports Yondr's broader expansion in Asia including projects across multiple countries.

Japan Green Data Center Market Report Scope:

Key Benefits for Stakeholders:

• IMARC’s report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the Japan green data center market from 2019-2033.
• The research study provides the latest information on the market drivers, challenges, and opportunities in the Japan green data center market.
• Porter's Five Forces analysis assists stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the Japan green data center industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.