RACK MOUNT UPS MARKET SIZE & SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2023 - 2030)

The Rack Mount UPS Market size is expected to reach US$ 4.67 billion by 2030, from US$ 2.98 billion in 2023, at a CAGR of 6.6% during the forecast period. Rack mount UPS are backup power systems designed to provide continuous power supply by mounting on standard IT racks. They protect critical infrastructure against power anomalies and outages. Rack UPS offer benefits such as space efficiency, flexibility, easy installation, and scalability. The market is driven by growing demand for data centers, increased need for power reliability and rise of modular UPS systems.

The Rack Mount UPS Market is segmented by product type, capacity, application, end-user and region. By product type, the market is segmented into online/double-conversion, line-interactive, standby/off-line, three phase, single phase and others. The online/double-conversion segment is expected to grow significantly owing to its ability to provide maximum protection for mission-critical applications.

Rack Mount UPS Market Regional Insights

• North America is expected to be the largest market for Rack Mount UPS Market during the forecast period, accounting for over 38% of the market share in 2022. The growth of the market in North America is attributed to the widespread adoption of rack UPS in data centers, presence of leading providers, and growing investments in edge infrastructure.
• The Europe market is expected to be the second-largest market for Rack Mount UPS Market, accounting for over 27% of the market share in 2022. The growth of the market in Europe is attributed to strict standards around uptime and the presence of many colocation facilities.
• The Asia Pacific market is expected to be the fastest-growing market for Rack Mount UPS Market, with a CAGR of over 8% during the forecast period. The growth of the market in Asia Pacific is attributed to rapid digitalization and data center growth across developing economies like India and Southeast Asia.

Figure 1. Global Rack Mount UPS Market Share (%), by Region, 2023

Rack Mount UPS Market Drivers

• Growing demand for data centers: The rapid growth in data generation and consumption worldwide is driving the demand for data centers. Data centers require high-quality, reliable, and uninterrupted power supply to operate smoothly. Rack mount UPS systems provide backup power supply and protect critical IT infrastructure against power outages. The rise of colocation, cloud, and edge data centers along with investments by hyperscale cloud providers such as AWS, Microsoft, and Google are fueling the adoption of rack-based UPS systems. Furthermore, the uptake of high-density computing equipment in data centers increases power load and creates the need for high capacity UPS systems in rack-mount form factors. Therefore, the proliferating data center industry acts as a major driver for the rack mount UPS market.
• Increased need for power reliability: With rising digitalization across industries, the dependence on electronic devices and digital infrastructure is increasing significantly. Rack mount UPS systems provide reliable and clean power supply to electronic equipment and minimize downtime caused by power disturbances. The need for power reliability is especially high in critical facilities such as hospitals, financial institutions, and telecom infrastructure. Rack-based UPS with advanced battery management systems provide mission-critical electrical protection. Moreover, modular UPS systems allow easy scalability and redundancy for power backup as per changing requirements. Thus, the growing need for power reliability and uptime is expected to spur the adoption of rack mount UPS solutions.
• Rise in modular UPS systems: Traditionally, UPS systems came in stand-alone formats, but technological advancements have led to the development of modular UPS systems. Modular UPS comprises individual hot-swappable modules that can be easily added or removed to increase or decrease capacity and redundancy. Rack-based modular UPS systems can be scaled precisely based on data center power demands. The modular design allows flexible system configuration, faster deployment, reduced TCO, and higher ROI. It also enables incremental capacity expansion according to load growth over time. The shift towards modular architecture is a key trend that is propelling the rack mount UPS market globally.

Rack Mount UPS Market Opportunities

• Rising demand from emerging economies: Emerging economies like China, India, Brazil, and Southeast Asian countries are undergoing rapid industrialization and urbanization. This is resulting in increased deployment of IT infrastructure and construction of high-quality data centers to manage the exponential data growth. Developing countries are investing heavily in smart city initiatives as well which involve deployment of racks and modular data centers. Rack mount UPS systems are integral to ensuring power continuity for critical infrastructure. Low labor costs, government support, and availability of raw materials make emerging markets lucrative for UPS manufacturers. The rising adoption of rack UPS in developing regions provides significant opportunities for market growth.
• Potential in hyperscale/edge data centers: The increasing amount of data and latency concerns are driving investments in hyperscale and edge data centers by cloud giants and colocation providers. Hyperscale facilities are massive in scale and require high-density, high-capacity power infrastructure. Edge sites are smaller but located in proximity to end-users, hence they also utilize rack-based UPS systems. Vendors are offering high power density UPS systems in space-saving forms tailored to hyperscale and edge sites. The mushrooming of hyperscale and edge facilities near metro areas, thus presents an excellent opportunity for rack UPS systems.
• Integration of IoT and cloud-based monitoring: The integration of IoT, AI, big data analytics, and cloud computing is disrupting the UPS landscape. Rack UPS systems with embedded sensors and connectivity can provide real-time monitoring and predictive analytics through cloud-based software platforms. This allows remote maintenance, rapid fault detection, preventive repairs, and proactive UPS management. The user-friendly cloud interface enables tracking of UPS performance metrics from any location. The integration of IoT and the cloud will enhance the functionality of rack-mount UPS systems and provide growth opportunities for vendors.

Rack Mount UPS Market Trends

• Integration of lithium-ion batteries: Traditionally, valve-regulated lead-acid (VRLA) batteries were used in UPS systems due to their low cost. However, they have limitations like low energy density, frequent replacement need, and slow charging. Lithium-ion batteries have emerged as a more efficient alternative with benefits such as long lifecycle, low maintenance, reduced weight, and compact size. Rack UPS manufacturers are integrating advanced lithium-ion batteries to enhance reliability and performance. Lithium-ion batteries also support modularity and scalability of rack-mount UPS systems. The integration of lithium-ion batteries is a major technology trend in the rack UPS market.
• Growing trend of intelligent UPS systems: Modern rack mount UPS systems are evolving with the integration of intelligent monitoring and predictive capabilities. Intelligent UPS can diagnose and anticipate problems before they occur using self-diagnosis algorithms and sensors. They can recommend preventive maintenance and streamline battery management. Intelligent systems also enable easy integration with building management platforms through open communication protocols. The inbuilt intelligence allows optimized performance and uptime. The development of smart, connected rack UPS systems is an important trend shaping the market's future.
• Increased adoption of online UPS systems: The rack mount UPS market is witnessing a shift from standby systems to double-conversion online UPS systems. Online UPS continually regulate power output and provide better protection from all power anomalies. They are more reliable and suited for critical infrastructure applications. Rack-based online UPS systems are witnessing increased adoption due to benefits such as zero transfer time to battery, advanced filtering, and regenerative capabilities. Online UPS systems are expected to gain more prominence over standby UPS for high-density rack applications like data centers and network closets.

Rack Mount UPS Market Restrain

• High purchasing and operating cost: Rack mount UPS systems involve substantial upfront investment as well as operating expenses. The systems require frequent battery replacement and ongoing maintenance which add to long-term costs. High-end rack UPS come with premium pricing. The additional expenses of professional installation, custom configuration, and life cycle services also deter adoption, especially among SMEs. Although enhancements like modularity aim to reduce costs, the overall pricing of rack UPS systems remains relatively high. Thus, the purchasing and operating costs pose a major restraint for market growth.
• Complex installation process: Rack mount UPS systems typically involve complex configurations spanning hardware, software, batteries, and extended components. The installation requires robust physical infrastructure, custom-engineered configurations and professional electrical expertise. Improper installation can compromise the safety and effectiveness of the system. The complexity of deployment often necessitates extensive planning, certified technicians and custom rack designs. Thus, the intricate installation process acts as a restraint for end-users and hampers the adoption of rack-based UPS solutions.
• Longer replacement cycles: Enterprises and data centers prefer to maximize the lifespan of capital investments like UPS systems to contain expenses. Rack mount UPS typically last between 5-10 years before needing replacement. Preventive maintenance and intelligent monitoring help extend longevity further. The long replacement cycles limit the recurring purchase of new rack UPS systems, creating a restrain for overall market revenue growth. However, adoption of modular and scalable architectures will help counteract the effects of increased product lifespans moving forward.

Recent Developments

New product launches

• In March 2022, Eaton announced the launch of its Edge Xpert rack mount UPS system to provide resilience for edge data centers. It offers 4-10 kW power range with lithium-ion batteries.
• In January 2021, Schneider Electric launched Galaxy VL 200-500 kVA UPS systems featuring easy installation and serviceability in a compact rack-mount form factor.
• In June 2020, Vertiv announced the addition of lithium-ion battery cabinets to its Liebert EXM UPS system for high-density rack applications like edge data centers.

Acquisition and partnerships

• In December 2021, Legrand acquired Gesellschaft für Systemdatenverarbeitung (GfS), a provider of datacenter solutions in Germany, to expand its rack UPS portfolio.
• In March 2022, Delta Electronics acquired MPI Corporation, a power magnetics and solutions provider, to strengthen its offerings in power infrastructure including rack power systems.
• In January 2022, Huawei partnered with Dubai Electricity and Water Authority (DEWA) to develop modular data centers pre-installed with Huawei's rack UPS systems.

Figure 2. Global Rack Mount UPS Market Share (%), by Application Type, 2023

Top companies in Rack Mount UPS Market

• Schneider Electric
• Eaton
• Emerson Electric
• Toshiba
• Siemens
• General Electric
• Delta Electronics
• Huawei
• ABB
• Vertiv
• Tripp Lite
• Socomec
• Kehua
• Legrand
• Rittal
• Fuji Electric
• Riello
• Panduit
• CyberPower Systems
• Piller Power Systems

*Definition: The Rack Mount UPS Market refers to the market for uninterruptible power supply (UPS) systems designed to be installed on standard 19-inch racks and server cabinets. Rack mount UPS range from small single-phase systems to large three-phase systems and provide backup power protection to IT infrastructure against power disturbances. They find wide application across data centers, telecom facilities, edge sites and other mission-critical installations.