Cloud Sustainability Market Size, Share and Trends 2024 to 2034

Cloud Sustainability Market Size and Forecast 2024 to 2034

The global cloud sustainability market size is calculated at USD 30.28 billion in 2024 and is predicted to reach around USD 175.82 billion by 2034, expanding at a CAGR of 19.23% from 2024 to 2034. The cloud sustainability market growth is attributed to the increasing demand for energy-efficient solutions, driven by regulatory pressures and a rising consumer awareness of sustainability practices.

Cloud Sustainability Market Key Takeaways

• North America dominated the cloud sustainability market with the largest market share of 37% in 2023.
• Asia Pacific is projected to expand at a fastest CAGR of 20.53% in the coming years.
• By solutions, the energy-efficient infrastructure segment accounted for the highest market share of 35% in 2023.
• By solutions, the green software solutions segment is expected to grow at the fastest CAGR of 74% during the forecast period.
• By enterprise size, the large enterprises segment has held the major market share of 74% in 2023.
• By enterprise size, the small and medium enterprises (SMEs) segment is anticipated to grow with the highest CAGR of 20.15% during the studied years.  
• By service model, the infrastructures as a service segment contributed the biggest market share of 43% in 2023. 
• By service model, the green data centers segment is projected to expand at a notable CAGR of 19.93% in the coming years.
• By end-user, the IT and telecom segment generated the highest market share of 29% in 2023.
• By end-user, the manufacturing segment is projected to grow at a fastest CAGR of 20.82% during the future years.

U.S. Cloud Sustainability Market Size and Growth 2024 to 2034

The U.S. cloud sustainability market size is exhibited at USD 7.84 billion in 2024 and is projected to be worth around USD 46.48 billion by 2034, growing at a CAGR of 19.44% from 2024 to 2034.

North America dominated the cloud sustainability market during the forecast period due to the technological giants and the higher diffusion of cloud services across sectors. Governments and companies in the United States and Canada rely on cloud infrastructure to support better performance and enhance sustainable development goals. Moreover, the region's supportive legal environment plus government policies, such as carbon credits, which pressure enterprises into embracing green processes, further facilitate demand for cloud sustainability.

• The IEA also reported that North America is most likely to become the biggest leader in the use of cleaner energy sources to achieve nearly 1,200 GW of renewable energy programs by 2024, which is in line with cloud-based energy management solutions.

Asia Pacific is projected to host the fastest-growing cloud sustainability market in the coming years owing to increased industrialization and urbanization. Countries such as China and India are consuming large amounts of energy productivity; this has led to a call for organizing and a sustainable manner.  Additionally, political activity in the countries of the region expands the regulations that prescribe the utilization of cloud solutions that increase energy efficiency and the rational use of resources. 

• According to the Asian Development Bank (ADB), Asia is estimated to spend about USD 1.7 trillion on renewable power by 2024, which suggests a strong commitment to sustainable development.

Market Overview

As organizations adapt to sustainable computing, growing demands for energy-efficient and sustainable solutions are expected to fuel the market. A technology that aims at the conservation of energy in the cloud system, as it reduces the use of energy from the power grid and also reduces the environmental effects since it uses renewable energy and efficient methods of data handling. 

Cloud sustainability encompasses incorporating green data centers, energy management software, and carbon reduction measures to enable organizations to achieve sustainable goals and meet laid-down environmental standards. Furthermore, cloud sustainability tech features high scalability, which means that organizations can deploy sustainable technology to track the impact on the environment and control expenses that result from unruly electricity consumption.

• The latest information from the International Energy Agency (IEA) shows that renewable energy has been on the ascent, likely to hit 1,600 GW by 2024, a sign of global focus on clean energy supply. 

Impact of Artificial Intelligence (AI) on the Cloud Sustainability Market

Artificial Intelligence (AI) contributes to strengthening the market for the sustainability of the cloud by efficient regulation of energy consumption and minimizing the negative impact on the environment. Both new and mature companies tap into artificial intelligence to redefine disruptive strategies in the strongly growing market environment. AI technologies keep on developing and reforming the current industries and creating new industries to open up a new potential market and transform business systems worldwide. Moreover, sustainable and responsible reorganization is influenced by ethical considerations facilitating the demand for stringent rules governing the development of AI.

Cloud Sustainability Market Growth Factors

• Increasing regulatory pressure: Governments worldwide are implementing stringent regulations to reduce carbon emissions, prompting businesses to adopt sustainable cloud solutions to comply.
• Rising consumer awareness: Growing consumer awareness and demand for sustainable practices influence companies to integrate eco-friendly cloud technologies into their operations.
• Technological advancements: Innovations in cloud computing technologies, such as artificial intelligence and machine learning, enhance the efficiency of sustainability efforts.
• Corporate sustainability Goals: Businesses increasingly set ambitious sustainability targets, driving the need for cloud solutions that help track and optimize energy use.
• Investment in green technologies: A surge in investment towards green technologies and infrastructure encourages companies to leverage cloud services for sustainability initiatives.
• Enhanced data management: The growing need for effective data management solutions motivates enterprises to adopt cloud platforms that offer sustainability analytics.
• Focus on cost reduction: Organizations aim to reduce operational costs through energy-efficient cloud solutions, further propelling the demand for sustainable practices.

Market Scope

Market Dynamics

Driver

Growing demand for energy efficiency solutions

Growing demand for energy efficiency technology solutions is anticipated to drive the market in the coming years. Businesses are focusing on increasing their efficiency while reducing their power consumption. Businesses looking for methods to cut their resource usage and cost of operations find it beneficial to use cloud services to monitor and curtail energy usage. Those organizations level up their power utilization by analyzing the results of AI executing analytics and data to track overall power usage and energy requirements and minimize excess use.

Green cloud solutions promote environmental conservation and have a social responsibility to corporate organizations and governments in achieving goals set in emission controls. Additionally, the modern trend of environmentally responsible business practices makes energy-efficient clouds a major part of sustainable business infrastructure.

Restraint

Regulatory challenges 

Regulatory challenges impede the widespread adoption of sustainable cloud practices, thus further hindering the market. Growing regulations that differ from one region to another make it challenging to undertake cloud sustainability measures. A diverse set of rules and regulations for implementing data handling, energy requirements, and impact assessment makes it challenging for organizations to comprehend them.

The EU has established the General Data Protection Regulation (GDPR), which sets strict rules that limit the way that firms handle data within cloud computing space. Such regulatory environs are poised to foster indecision in regard to the shift to cloud sustainability.

Opportunity

Investment in renewable energy technologies

Growing investment in renewable energy technologies presents an immense opportunity for the players competing in the cloud sustainability market. Businesses increasingly commit to integrating renewable energy sources, such as solar and wind, into their operations. This increasing renewable energy increases the demand for cloud solutions that promote efficient energy use to enhance the carbon credits for any business.

The drive towards renewable energy is an opportunity within a market and also pushes for cloud service providers and energy companies to look for better methods of working together while trying to come up with new and sustainable solutions. Additionally, efforts, such as the United Nations Sustainable Development Goals (SDGs), envisage providing affordable, reliable, sustainable, modern energy for all by 2030, making the rollout of these clouds crucial.

Solution Insights

The energy-efficient infrastructure segment held a dominant presence in the cloud sustainability market in 2023 due to the increased need for organizations to reduce their environmental impacts while raising operational performance. Furthermore, the proactive approach makes energy-efficient infrastructure.

• DOE report shows that energy-effective procedures within the data center save between 20% and 30% of energy, resulting in greater financial and environmental returns. 
• According to the IEA, investment in energy efficiency technology for cloud service will be around USD 35 billion by 2024, suggesting an embracement of sustainable solutions.

The green software solutions segment is expected to grow at the fastest rate in the cloud sustainability market during the forecast period of 2024 to 2034, as different organizations are convicted of needing sustainable software development strategies. Moreover, industries with active participation in green software strategies are expected to create immense opportunities for the segment.

• Green Software Foundation states that software consumes approximately 30% of total global energy consumption, where the optimization of software design and execution offers benefits. 
• A survey revealed that by the end of 2023, a total of 52% of organizations are likely to integrate green software practices for cutting emissions and still perform optimally. 
• According to the study conducted at the World Economic Forum, businesses using green software solutions are able to decrease their operation energy by up to 40%, which makes known the potential savings in perfuming such practices. 

Enterprise Size Insights

The large enterprises segment accounted for a considerable share of the cloud sustainability market in 2023, owing to their large reserves and the intensity with which they practice sustainable practices. In 2024, these organizations are likely to engage in massive investments in clouds that improve energy management and overall sustainable programs. Furthermore, large firms are actively adopting sustainable practices to minimize carbon emissions, which further fuels the demand for sustainability solutions in these sectors.

• The Global Data Center Energy Forecast report shows that large enterprises implement AI and ML to increase energy efficiency, as consumption is expected to be slashed by up to 40%.

The small & medium enterprises (SMEs) segment is anticipated to grow with the highest CAGR in the cloud sustainability market during the studied years during the forecasting period, as they are innovative in adopting new technology adoptions, and there is increasing concern for sustainability practices.  Additionally, the shift towards remote work and increased digitalization resulted in these enterprises adopting cloud solutions that improve business operations and save energy.

• The International Telecommunication Union (ITU) report shows that SMEs comprise about 90% of businesses globally and contribute greatly to the world economy.

Service Model Insights

The infrastructures as a service segment led the global cloud sustainability market due to the ability to implement ideal practices in a vast area and at various levels. IaaS optimizes the management of an organization’s IT systems and the conservation of energy. This service model helps enterprises harness on-demand computing, storage capacities, and networks. They are able to reduce expenditures related to energy and hardware maintenance.

• The International Energy Agency (IEA) says firms that adopt IaaS save between 25-30% of energy due to moving their compute demand into a virtualized environment rather than supporting it through on-premise servers. 

The green data centers segment is projected to expand rapidly in the cloud sustainability market in the coming years, owing to the growing consciousness of the environment and the high costs that organizations incur when adopting energy efficiency measures. These facilities adopt sophisticated energy conservation and CO2 emission control technologies for efficiency. Furthermore, the growth in consumption of cloud services is likely to create the need to establish eco-friendly data centers as firms try to embrace eco-friendly measures. This increasing trend toward greenness triggers the impact of green data centers being an integral part of cloud services transformation incremental towards sustainable goals.

• According to the Global Sustainability Initiative survey carried out in 2023, as many as 70% of data center owners singled out investments in green technologies as crucial to achieving sustainability goals. 

End-user Insights

The IT & telecom segment dominated the global cloud sustainability market in 2023 during the forecasting period due to the sector's technological evolution and the growth of cloud usage throughout the processes essential for the actors. Major organizations in this industry are embarking on aggressive cloud infrastructure investments to improve services and capacity. Additionally, there is an increase in focus on regulatory compliance and sustainability-related efforts.

• A report by Gartner showed that the IT and telecom sector was expected to spend USD 500 billion in cloud services by 2024 based on a strong need for efficient, green solutions. 

The manufacturing segment is projected to grow at the fastest rate in the cloud sustainability market in the future years, owing to the continued need to make the current manufacturing processes energy-efficient and sustainable. The adoption of cloud-based services helps the sector address acute issues of data processing and resource management that are imperative in minimizing wastage. The manufacturers who adopt cloud technologies have gained the advantage of at least a 30% decrease in energy consumption due to improvement in efficiency. Additionally, the growing need for cloud services in various manufacturing sectors, including automobiles, will further boost the market in the coming years.

Cloud Sustainability Market Companies

• SAP
• Salesforce
• Oracle Cloud
• Nutanix
• Microsoft Azure
• IBM Cloud
• Google Cloud
• Equinix
• Dell Technologies
• Amazon Web Services (AWS)

Recent Developments

• In February 2024, Google Cloud announced a partnership with HSBC to enhance its "Google Cloud Ready – Sustainability" program. This initiative aims to support climate tech companies by providing financing and technological assistance to help them develop solutions for carbon emission reduction and improve sustainability in value chains. HSBC committed to deploying USD 1 billion in climate tech finance to support these companies, starting with venture debt financing for Level Ten Energy, which specializes in clean energy transactions.
• In April 2024, Salesforce unveiled its Sustainability Cloud 2.0, designed to help organizations track, manage, and reduce their carbon emissions more effectively. The updated platform incorporates advanced analytics and artificial intelligence to provide deeper insights into sustainability practices. This version allows users to visualize their carbon footprint and set actionable goals, promoting accountability and transparency in corporate sustainability efforts.

Latest Announcements by Leaders

• In June 2024, Microsoft introduced an AI-powered Sustainability Toolkit was introduced as part of its commitment to help organizations reduce their environmental impact. This toolkit integrates AI capabilities into existing Microsoft Azure services, enabling businesses to analyze their energy usage and carbon emissions in real-time. The goal is to facilitate more informed decision-making regarding sustainability initiatives, ultimately aiming for net-zero emissions across Microsoft’s customer base.

Segments Covered in the Report

By Solution

• Green Software Solutions
• Energy-Efficient Infrastructure
• Carbon Management Solutions
• Sustainable Cloud Platforms

By Enterprise Size

• Large Enterprises
• Small and Medium Enterprises (Smes)

By Service Model

• Platform as a Service (Paas)
• Infrastructure as a Service (Iaas)
• Green Data Centers
• Software as a Service (Saas)
• Others

By End-user

• BFSI
• IT and Telecom
• Healthcare
• Retail and E-Commerce
• Manufacturing
• Others

By Geography

• North America
• Asia Pacific
• Europe
• Latin America
• Middle East and Africa