Data Center Cooling Tower Market to Reach USD 2.44 Billion by 2035 as Water Rules Push Hybrid and Adiabatic Coolers - DC Market Insights

Market grows at an 8.06% CAGR from USD 1.12 billion in 2025; hybrid and adiabatic coolers grow fastest at 12.39% a year as AI campuses trade water against power, and replacement plus service work rises to 43.4% of spending by 2035

LONDON, Oct. 19, 2026 /PRNewswire/ -- The "Data Center Cooling Tower Market - Growth, Share, Opportunities & Competitive Analysis, 2026-2035" report has been added to the DC Market Insights offering. The global Data Center Cooling Tower Market was valued at USD 1.12 billion in 2025, is estimated at USD 1.30 billion in 2026, and is projected to reach USD 2.44 billion by 2035, growing at a CAGR of 8.06% from 2025 to 2035. DC Market Insights finds that money in this market follows water, not heat: evaporative cooling towers reject data center heat with the least electricity of any method, but water-use disclosure laws in the European Union, California and Utah, and 45 °C liquid-cooled AI racks that can run on dry coolers, are reshaping which designs new campuses buy.

Data Center Cooling Tower Market at a Glance

Key Takeaways

• The market more than doubles from USD 1.12 billion in 2025 to USD 2.44 billion in 2035, because new data center capacity served by evaporative heat rejection still grows 55%, from 5,448 MW to 8,467 MW a year, even as its share of new builds falls from 45.4% to 31.4%.
• Hybrid and adiabatic coolers rise from 25.0% to 37.0% of market value, because they use water only on the hottest days and fit water-disclosure rules better than open towers.
• Open-circuit towers keep the largest share in 2035 at 33.0%, because they remain the cheapest way to reject heat per kilowatt at water-rich and reclaimed-water sites.
• Replacement and rebuild work grows 9.77% a year and service and maintenance grows 10.36% a year, both faster than new equipment, as towers built in the 2015-2025 boom reach mid-life.
• The evaporative-served installed base grows from 55,680 MW of IT load in 2025 to 124,400 MW in 2035, creating a large recurring revenue pool for rebuilds, Legionella risk management and water metering.
• Dry coolers are the main substitute: an October 2026 order for more than 1,000 dry coolers providing 5 GW of AI heat rejection shows how much new AI capacity can move outside this market.

Scope & Segmentation - Data Center Cooling Tower Market

The report analyzes the market across the following segments:

• Product Type: Open-Circuit Cooling Towers; Closed-Circuit Fluid Coolers; Hybrid and Adiabatic Coolers.
• Construction: Factory-Assembled Units; Field-Erected Towers.
• Data Center Type: Hyperscale and AI Data Centers; Colocation Data Centers; Enterprise and Edge Data Centers.
• Offering: New-Build Equipment; Installation and Commissioning; Replacement and Rebuilds; Service and Maintenance.
• Geography: North America, Europe, Asia Pacific, Latin America, Middle East and Africa, with 12 country forecasts.

Report Updated: Oct. 18, 2026

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"The data center cooling tower decision is now a water decision as much as a thermal one. AI campuses that are capped by their grid connection still value the low fan and compressor power of evaporative heat rejection, but disclosure laws and 45 °C liquid cooling are pushing many new halls toward hybrid, adiabatic or fully dry designs. That is why we see hybrid coolers, rebuilds and service contracts growing faster than open towers, and why suppliers that can retrofit an existing tower to cut water by 75% to 90% are best placed for the next decade."

— Amit Jain, Senior Consultant, ICT & Emerging Technologies, DC Market Insights, report author

Why This Report Matters

Cooling towers sit where three pressures meet: rising AI heat loads, constrained grid power and new public scrutiny of data center water use. The report helps cooling tower and fluid cooler manufacturers, data center operators, hyperscalers, mechanical contractors, water-treatment and service providers, and investors size evaporative and hybrid heat rejection spending, compare it with dry cooling, and track where rules and climate keep water-based designs competitive.

Key Attributes

How Big Is the Data Center Cooling Tower Market in 2026?

DC Market Insights values the Data Center Cooling Tower Market at USD 1.30 billion in 2026, 15.65% above 2025, as AI campuses ordered in 2025 receive their heat rejection equipment. The market grew 14.77% a year from 2020 to 2025 because new data center IT capacity doubled from 6,000 MW to 12,000 MW a year. The chart below shows the market path to 2035.

Source: DC Market Insights, Data Center Cooling Tower Market report, Oct. 2026.

Why Does Growth Slow From 14.77% to 8.06% a Year?

Growth slows for one reason particular to this product: water. NVIDIA puts the water use of conventional evaporative designs at about 2.6 million gallons per MW a year, and racks that accept 45 °C coolant can run on dry coolers with zero water. DC Market Insights therefore models the evaporative share of new AI capacity falling from 48% in 2025 to 30% in 2035, and the evaporative share of all new data center capacity falling from 45.4% to 31.4%. Because total new capacity rises from 12,000 MW to 27,000 MW a year, evaporative-served capacity still grows in absolute terms.

Which Cooling Tower Type Leads Data Center Spending?

Open-circuit cooling towers lead with 45.0% of 2025 value (USD 505.90 million) but grow only 4.76% a year, because open water contact makes them the main target of water rules. Hybrid and adiabatic coolers are the fastest-growing product at 12.39% a year and approach open towers in value by 2035.

Which Data Center Type Spends the Most on Cooling Towers?

Hyperscale and AI data centers spend USD 539.63 million in 2025 (48.0%) and grow 10.50% a year, the fastest data center type, because they add most new capacity even with lower evaporative shares. Enterprise and edge sites grow only 0.83% a year as server rooms move to colocation and cloud.

Construction and Offering: Where Does the Money Go?

Factory-assembled units hold 72.0% of 2025 value (USD 809.45 million) and grow 9.07% a year as heat rejection modules reach 5 MW per unit; field-erected towers grow 5.00% a year. By offering, new-build equipment leads with 54.1% of 2025 value, while service and maintenance grows fastest at 10.36% a year.

DC Exclusive: How Much Water and Capital Does Each Heat Rejection Design Need?

DC Market Insights modelled the equipment cost and yearly water use of five ways to reject heat from one MW of IT load in 2025. A hybrid or adiabatic cooler cuts water by 75% to 90% compared with an open tower for about USD 75,000 to USD 85,000 more equipment per MW, while a dry cooler removes water entirely but costs about 2.6 times the open tower and needs the most fan power on hot days.

How Much Does Data Center Heat Rejection Cost per MW?

DC Market Insights estimates evaporative heat rejection equipment at about USD 95,000 per MW of IT load in a conventional hall and USD 140,000 per MW in an AI hall in 2025, or about USD 73 to USD 108 per kW of heat rejected, before installation at 18% of equipment value.

What Is Driving Data Center Cooling Tower Demand?

• Supplier capacity build for AI campuses: SPX Technologies raised its estimated annual data center revenue capacity to about USD 1.1 billion in July 2026, Baltimore Aircoil Company opened its first Latin American plant near Monterrey, Mexico, in May 2026, and EVAPCO announced an Indian subsidiary in August 2026.
• Lower electricity on grid-limited campuses: evaporative towers are far less energy intensive than dry alternatives, which matters where grid power, not water, is the binding constraint, especially in the United States, India and Southeast Asia.
• An installed base that more than doubles: each evaporative-served MW carries a rebuild cycle on fill, fans and gearboxes, and a maintenance contract worth USD 3,500 a year in 2025 rising to USD 4,200 in 2035.

What Could Shrink Cooling Tower Spending?

• 45 °C liquid cooling and dry coolers: if AI halls move faster to chiller-less dry cooling, the evaporative share of new AI capacity reaches 20% instead of 30% in 2035 and the market reaches USD 2.03 billion instead of USD 2.44 billion.
• Water disclosure laws: California AB 2469 and AB 2619 (signed 21 September 2026), Utah HB 76 (effective 6 May 2026), and EU Delegated Regulation 2024/1364 with the European Commission's new data centre rating scheme with WUE classes all raise the political cost of open towers.

Where Are the Openings for Cooling Tower Suppliers?

The two largest openings are hybrid retrofits of existing towers and service contracts, together worth about USD 1.06 billion in 2035. Replacement and rebuild work reaches USD 537.41 million (22.0% of the market), and service and maintenance reaches USD 522.48 million as operators buy contracts that cover Legionella risk management under ASHRAE Standard 188 and water-use metering for the new disclosure laws.

Which Region Spends the Most on Data Center Cooling Towers?

North America leads with 44.0% of 2025 value (USD 494.66 million). Latin America is the fastest-growing region at 11.99% a year, and Europe is the slowest at 5.00% as cool climates and water reporting favour dry cooling.

Which Countries Buy the Most Data Center Cooling Towers?

The United States leads with USD 438.45 million in 2025, 39.0% of global value. India is the fastest-growing of the 12 largest countries at 14.82% a year, rising from USD 33.73 million to USD 134.30 million, because its new capacity sits in hot coastal hubs where evaporative heat rejection saves scarce grid power. Malaysia grows 13.73% a year on Johor's campus pipeline.

How Could the 2035 Forecast Change?

Which Rules and Standards Apply to Data Center Cooling Towers?

• CTI STD-201 thermal performance certification for cooling towers and fluid coolers.
• ANSI/ASHRAE/IES Standard 90.1 with Standard 90.4 as the data center compliance path.
• ASHRAE Standard 188 for Legionellosis risk management in building water systems.
• Delegated Regulation (EU) 2024/1364: water input and WUE reporting for data centres of 500 kW and above.
• EU data centre rating scheme with PUE and WUE classes, adopted 21 September 2026.
• California AB 2469 and AB 2619 (2026) and Utah HB 76 (2026) on data center water reporting.

Competitive Landscape and Recent Developments

SPX Technologies (Marley, Recold), Baltimore Aircoil Company and EVAPCO together hold about 50% of 2025 market value, according to DC Market Insights. Companies profiled include SPX Technologies, Baltimore Aircoil Company (Amsted Industries), EVAPCO, Kelvion, Güntner, Johnson Controls, Hamon, Enexio, Delta Cooling Towers, Brentwood Industries, Paharpur Cooling Towers, King Sun Industry, Liang Chi Industry and Kuken Kogyo.

• In October 2026, Kelvion won a USD 800 million order for more than 1,000 dry coolers providing 5 GW of heat rejection for a United States AI campus.
• In September 2026, California's governor signed AB 2469 and AB 2619 on data center water use, and the European Commission adopted a data centre rating scheme with WUE classes.
• In August 2026, SLB agreed to acquire Kelvion, whose largest end market is data centers.
• In July 2026, SPX Technologies raised its estimated annual data center revenue capacity to about USD 1.1 billion.
• In May 2026, Baltimore Aircoil Company opened its first Latin American plant near Monterrey, Mexico.

Frequently Asked Questions

What is the size of the Data Center Cooling Tower Market?

USD 1.12 billion in 2025 and USD 1.30 billion in 2026, projected to reach USD 2.44 billion by 2035 at an 8.06% CAGR, according to DC Market Insights.

What is a data center cooling tower?

Equipment that rejects data center heat by evaporating part of the condenser or process water into the air: open-circuit towers, closed-circuit fluid coolers and hybrid or adiabatic coolers, with their installation, rebuilds and service. Pure dry coolers and chillers are excluded.

How much water does a data center cooling tower use?

About 9,800 cubic metres per MW of IT load a year for an open tower, consistent with the 2.6 million gallons per MW that NVIDIA cites for evaporative designs. Hybrid and adiabatic coolers cut that by 75% to 90%.

Do AI data centers still use cooling towers?

Yes. 48% of new AI capacity used evaporative or hybrid heat rejection in 2025, falling to 30% by 2035 in the base case, as 45 °C liquid cooling lets many AI halls use dry coolers while grid-limited hot sites keep evaporative designs.

Which region leads the market?

North America, with 44.0% of 2025 value. Latin America grows fastest at 11.99% a year, and India is the fastest-growing large country at 14.82% a year.

Who are the leading data center cooling tower companies?

SPX Technologies (Marley), Baltimore Aircoil Company and EVAPCO, about 50% of 2025 value together. Kelvion, Güntner, Johnson Controls, Hamon, Enexio and Delta Cooling Towers also compete.

Methodology

DC Market Insights built the market bottom-up from evaporative-served MW of new and installed IT capacity, equipment value per MW for conventional and AI halls, installation at 18% of equipment value, rebuilds at 4% a year of the evaporative-served installed base, and service at USD 3,000 to USD 4,200 per MW a year. Results were checked against supplier-revenue ceilings and floors, including SPX Technologies' disclosed HVAC revenue and data center capacity.

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DC Market Insights Data & Tools

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• PUE Calculator

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