The AI computing power factory is giving birth to a major reshuffle in the power equipment industry: Who will silently prosper in the $200 billion market, and who will be kicked out of the game?

The new generation AI computing power factory is forcing power equipment companies to reexamine their business layout in order to seize the golden track with a market size expected to exceed 200 billion dollars this year. The AI industry is driving data centers towards a new form - with stronger performance, more compact layouts, and more efficient energy performance. This trend is forcing companies like Schneider Electric and Siemens to provide core electrical equipment for server clusters to upgrade their technology to ensure their products remain competitive in the long term. Industry research analyst Omid Vaziri pointed out, "This profound technological change will ultimately determine which companies can stand out and gain a competitive advantage." Royal Bank of Canada Europe analyst Mark Fielding predicts that in the next five years, the potential size of the data center equipment market will reach around 220 billion dollars annually, more than doubling the estimated 600 billion dollars per year in 2024. With the new generation AI factory becoming the next frontier for data centers, market opportunities are rapidly expanding. Currently, mainstream data centers generally use AC power supply, which is then converted to DC power supply for chip operation. However, to improve AI performance, it is necessary to increase rack density, which requires support for higher voltages. Fielding says the ideal solution is an 800-volt DC power supply system, with a transmission capacity almost three times that of existing AC cables. This power supply technology innovation will be phased in. Companies like Schneider and Siemens are developing so-called 800-volt DC auxiliary equipment to help existing data centers handle higher power consumption from AI servers. Vaziri pointed out that this technology separates pure IT racks from auxiliary function racks, which is more of a transitional solution rather than the ultimate goal. Ciaran Flanagan, Global Head of Siemens Data Center Solutions and Services, said, "Current data centers predominantly use AC power and will continue to operate for 20 to 30 years. The auxiliary equipment allows operators to introduce 800-volt DC power to support high-density AI workloads without having to change existing infrastructure." Fielding from Royal Bank of Canada pointed out that the longer-term vision is to build an 800-volt DC architecture around solid-state transformers. This equipment integrates multiple power conversion steps into one, effectively reducing energy consumption. This shift may disrupt the current supply chain layout of data centers. Uninterruptible Power Supply (UPS) systems account for about 16% of the cost of data center infrastructure, and their importance may decrease after the function is integrated into solid-state transformers. In addition, products such as distribution units, traditional transformers, switchgear, and backup generators may face shrinking demand if the new architecture becomes popular. Differentiation in the landscape: Clear opportunities and pressure points French electrical equipment manufacturer Legrand - Schneider faces greater risk exposure in the area of distribution units, and with the pressure from the new power architecture lowering demand, the impact will be more pronounced. On the other hand, rectifiers, battery energy storage systems, liquid cooling equipment, and solid-state transformers themselves bring new growth opportunities for power equipment manufacturers. Frederic Godemel, Executive Vice President of Energy Management at Schneider Electric, said the company is exploring various architectural solutions for ultra-large data centers, including solid-state transformers, transformer rectifier units, and centralized energy storage solutions. He said in an interview about customers, "Our job is to plan large-scale deployment timelines with each customer." It is expected that although Schneider and Vertiv Technologies are expected to maintain their market leadership, as data centers adopt new power technologies, competitors such as ABB, Eaton Corp. Plc, and Siemens are expected to narrow the gap. Vaziri pointed out, "Product structure is crucial, as some products may face the risk of being replaced." Vaziri believes that ABB and Eaton Corp. Plc have strong competitive advantages through their technology accumulation and acquisition layout in the field of high-voltage electrical equipment. GE Vernova Inc. is testing solid-state transformers, which could become a strong competitor; while Siemens can actively expand based on its high-voltage system experience outside of data centers. Analyst Kulwinder Rajpal from Alphavalue pointed out that Schneider's recent acquisition of Motivair is expected to stand out in the field of liquid cooling; Siemens Energy's gas turbine business is expected to continue growing; and Alfa Laval's first-mover advantage in the heat exchanger field is also worth noting. In addition, Schneider recently acquired Cognite for 3.1 billion dollars to expand its industrial data and AI software business. Time window still open For equipment manufacturers, the good news is that while they compete for the favor of ultra-large customers, they still have sufficient preparation time. Fielding said, "Currently, the ideal solution of 800-volt DC based on solid-state transformers is not yet mature in terms of technology and business." He added that the related profit impact is unlikely to show before 2030. Even by 2030, Fielding estimates that only about 20% of data centers will use 800-volt DC power, limited component supply and lack of safety standards will be the main constraints. Flanagan from Siemens said, "From Siemens' perspective, this is not a choice between AC and DC. Both technologies will play important roles in the coming years." Godemel from Schneider believes that regulatory policies and supply chain bottlenecks for solid-state transformers are the main challenges, but he said, "We are confident in solving these problems."