Green ICT Market Report Scope & Overview:

The green ICT market is growing rapidly as businesses and governments around the world focus on reducing their carbon footprints and improving the efficiency of their energy-intensive IT operations. Green ICT includes sustainable practices in ICT system design, development, deployment, energy-efficient hardware, cloud computing, smart grids, and data centers running on renewable energy systems. The growth is fueled by climate change awareness, higher energy demands, and the need to adhere to strict environmental regulations. Green ICT technologies aid in the reduction of energy consumption and operational costs, making them an automatic strategic investment point for companies seeking sustainability. One of the high-impact rendering facets boosting the growth of the green ICT market is the increasing usage of cloud computing and virtualization technologies. Cloud services allow enterprises to consolidate their IT infrastructure — minimizing on-site servers and data centers — saving a vast amount of energy consumption. Green data centers that use efficient cooling systems, as well as renewable energy, have taken precedence among a wide spectrum of companies aiming to lower their environmental footprint. Another major driver for growth is the adoption of IoT and AI technologies to manage energy. These tools enable real-time energy optimization, resource tracking, and waste reduction. Smart grids driven by AI can forecast energy demand and supply, which helps improve electricity distribution efficiency. Moreover, the expansion of electric vehicles as well as necessary electric vehicle charging systems are another driving factor for green ICT, for the further combination of sustainable technologies in transportation sectors and energy sectors.

The Green ICT market has a rapid growth driven by a global movement toward sustainable development and energy efficiency, where cloud computing, AI, IoT, and green data centers can play very important and critical roles. These technologies will likely use less energy and be less harmful to the environment, and this may help even more rapid growth of the market.

Green ICT Market Dynamics

Drivers

• Cloud services help consolidate IT infrastructure, minimizing energy consumption and hardware requirements.

Cloud services are essential in the Green ICT market by allowing companies to combine several IT infrastructures targeting a smaller energy and hardware consumption footprint. Historically, businesses have used on-premises data centers that needed enormous physical technology, cooling systems, and electricity. And these data centers were often wasted, consuming more energy than necessary. Cloud computing has also allowed some organizations to fully utilize shared, virtualized resources hosted in cost-effective, energy-efficient data centers.

Cloud providers invest heavily in massive, energy-efficient data centers with the end goal of delivering the best performance for the lowest power usage. These centers use high-tech cooling systems, sustainable energy, and energy-efficient hardware to minimize their environmental footprint. Switching to cloud services enables firms to drop the need for their hardware, thereby reducing energy consumption related to operations, maintenance, and cooling by a significant percentage. To meet sustainability targets, major cloud platforms such as Amazon Web Services, Microsoft Azure, and Google Cloud have made significant progress with renewable energy and energy-efficient technologies since then. Additionally, cloud services allow businesses to scale up or down their IT infrastructure according to demand, ensuring optimal resource use. Firms are only using as much power as they require consequently eradicating the inefficiencies connected with over-provisioning sources as frequently experienced in a typical data center. Dynamic scalability ensures that you are not consuming more energy than you actually need. Apart from lowering hardware demand, cloud computing encourages the growth of energy-efficient apps and services. Cloud computing allows organizations to centralize their IT resources, leading to reduced waste and a smaller carbon footprint. Cloud-based services work as the lifeblood of the Green ICT marketplace, progressing sustainability, reducing the cost of operations, and helping organizations and enterprises realize energy efficiency and green marketing objectives.

• Growing concern over climate change and the need for businesses to reduce their carbon footprints.

• Increasingly stringent environmental regulations and policies promoting sustainable practices in ICT operations.

Restraints

• The long-term return on investment for green ICT technologies may deter some organizations from making the transition.

The daunting challenge for organizations to adopt and shift toward green ICT-green information and communication technologies is the long-term return on investment for the technologies. The benefits of green ICT are not only related to environmental sustainability or process efficiency, some of the practical aspects of green ICT are also enhanced when it comes to energy and capital cost as a whole. One of the challenges companies face is defending the initial investment in energy-efficient hardware, renewable energy solutions, and cloud computing infrastructure when measurable savings and environmental dividends are not readily apparent. As an example, investing in energy-efficient data centers requires significant investment in new hardware, advanced cooling appliances, and renewable energy alternatives. Likewise, cloud services, or virtualization, necessitates major adjustments to existing IT infrastructure; in both time and money. Such financial strain may be especially daunting for small- and medium-sized enterprises, which might see keeping their systems as-is to be a more viable option than funding new green methods. In addition, the return on investment from green ICT solutions usually materializes in the long term. The payback of this investment may take longer than five years, even as energy savings and reduced operational costs build up over time. In sectors that view short-term profits as the most important, the training ground on investment can make green ICT unattractive to corporations to invest in, not least because their rivals have not yet crossed the chasm. In addition, there may be uncertainty that comes with the future economic landscape, for example, moving energy prices or environmental regulations that change the outlook regarding the ROI of green ICT. However, the sustainable, cost, and compliance benefits of green ICT delivery might take much time to reflect in ROI, which may result in a lack of acceptance of these technologies by businesses.

• A shortage of professionals with expertise in sustainable ICT practices hinders market adoption.

• Transitioning to cloud-based green ICT solutions raises concerns about data privacy and cybersecurity.

Green ICT Market Segment Analysis

By Component

The  hardware segment dominated the market and represented a significant revenue share in 2023, due to the increasing need for energy-efficient infrastructure in data centers. As both companies and organizations work to minimize their carbon footprints, energy-efficient servers are an effective answer to the need to lower power usage and cut operating expenses. Environmental framework and IT sustainability are two important factors because energy-efficient hardware is adaptable. These servers are more energy efficient, produce less heat, and require less cooling, suitable for modern green data centers. The need for energy-efficient servers will be increasing due to a rise in sustainable IT organizations. The energy-efficient hardware market is expected to continue this trend and grow with businesses concentrating on decreasing their carbon footprint and operating costs by 2032. The growing trend of cloud computing, big data, and artificial intelligence applications will contribute to the demand for energy-efficient servers, thus driving the segment growth.

Managed services are expected to grow at the fastest CAGR during the forecast period, due to the growing preference of organizations to outsource the management of their IT technologies to specialist service providers. These services allow enterprises to reduce their energy utilization through optimization of their IT infrastructure and operations. Managed services also mean that companies can adapt their green ICT solutions as they grow without needing to invest in expensive in-house capabilities. Providing managed services that include green IT solutions like energy management and cloud optimization is becoming increasingly essential as organizations move towards a sustainable and energy-efficient future. The managed services segment is anticipated to grow at a fast pace throughout the forecast period since there is a need among organizations to harness third-party knowledge in the management of energy-efficient IT solutions.

By Deployment

The cloud segment dominated the market and represented a significant revenue share in 2023, due to the scalability, flexibility, and energy efficiency that the cloud-based deployment type offers. The usage of cloud services has allowed businesses to make their IT infrastructure more cohesive, thus eliminating the need for physical servers and in turn, energy consumption. For this reason,  it is also a good choice for those organizations that want to shrink their carbon footprint, cloud providers spend a lot on energy-efficient data centers, renewable energy sources, and virtualization technologies. Cloud computing also helps in consolidation for businesses,  making efficient operational use of resources and minimizing operational cost, which is another driving factor for cloud-based solution adoption in the Green ICT market.

The on-premises deployment type is anticipated to grow at the fastest CAGR during the forecast period. Growth is fueled by continued demand for organizations needing to keep infrastructure in-house due to special data privacy, security, or regulatory requirements. At the same time, improvements in energy-efficient hardware and green data centers are significantly reducing the footprint of on-premises solutions, allowing organizations to maintain some control over their IT systems while continuing to push toward sustainability goals. Green software solutions and energy management tools are also being embraced to optimize on-premises IT operations. From 2024 to 2032, the on-premises segment will grow rapidly as many companies move their resources into energy-efficient, sustainable infrastructure. On-premise solutions will remain in demand for companies in compliance-heavy industries like finance, healthcare, and government, while green technology will start to green up on-premise systems.

Regional Analysis

North America dominated the Green ICT market and accounted for the largest revenue share in 2023, due to the combined effect of technology early adopters, regulatory pressure to adopt sustainable business practices, and extensive investment in energy-efficient IT infrastructure. This is attributed to an established cloud computing ecosystem, the large-scale use of green data centers, and the increasing deployment of renewables within the region. Moreover, the market of Green ICT solutions in North America is being propelled by governmental initiatives and corporate thrusts towards net-zero emissions. The Green ICT Market opportunity in North America is expected to remain dominant till 2032, driven by investment in energy-efficient technologies and integration of renewable energy. Further contributing to the regional market growth will be the rise in smart cities and the increasing investments in digital transformation, sustaining the region's leadership position in the market.

Asia-Pacific is expected to record the fastest CAGR over the forecast period owing to the pace of urbanization, industrialization, and transformation to a digital economy and society. These drivers mainly consist of the rising information and technology industry in the region, wide usage of cloud computing, and government initiatives working towards green technology adoption. China, India, and Japan are investing heavily in renewable energy and energy-efficient information technology infrastructure, which is expected to expand the Green ICT market in the region. A heightened emphasis on sustainability and energy efficiency, along with robust economic growth will make certain that the adoption of Green ICT solutions will see a substantial rise across industries in the region.

Key Players

The major key players along with their products are

• Cisco Systems – Cisco Energy Management Suite

• IBM Corporation – IBM Green Data Center

• Microsoft Corporation – Microsoft Azure Sustainability Calculator

• Google LLC – Google Cloud Carbon Footprint Tool

• Hewlett Packard Enterprise (HPE) – HPE GreenLake

• Dell Technologies – Dell PowerEdge Energy-Efficient Servers

• Amazon Web Services (AWS) – AWS Sustainability Program

• Intel Corporation – Intel Xeon Energy-Efficient Processors

• Schneider Electric – EcoStruxure IT

• Siemens AG – Siemens Smart Infrastructure Solutions

• Fujitsu Limited – Fujitsu Green Data Center Solutions

• Hitachi Ltd. – Hitachi Energy Management Systems

• Accenture – Accenture Green IT Services

Recent Developments

October 2024: Intel Corporation Introduced energy-efficient processors designed for green data centers.

November 2024: Amazon Web Services (AWS) Invested in solar farms to power its global cloud infrastructure sustainably.

December 2024: Google Cloud Enhanced carbon-intelligent computing to optimize workloads for renewable energy availability.