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With AI pushing data center demands to record highs, operators are resorting to prefabricated, modular infrastructure designs to cut deployment timelines and bring capacity online faster
Modular data center designs are on the rise, as AI drives massive infrastructure build.
Typically, site-built constructions which entail assembling the infrastructure piece by piece on the spot take years to complete. By contrast, pre-made modules are shipped ready to deploy, allowing operators to sidestep two critical bottlenecks: time to power and time to build.
“Instead of linear, site-built construction, prefabrication enables parallel execution with power, cooling, and IT infrastructure engineered, assembled, and tested off-site while civil works proceed in parallel,” said Tarunjeet (TJ) Sarao, senior vice president of data center systems at Schneider Electric.
The corollary is reduced time to power and revenue. “In practice, this approach can bring capacity online months earlier than traditional builds,” Sarao said.
The appeal extends beyond just deployment speed. Pre-fab modules also reduce design risk, variability, and rework. The engineering design and quality are consistent across modules. This translates as lower on-site complexity leading to faster, less disruptive builds.
As Sarao noted, the integrated architecture comes loaded with power systems, cooling units, and IT racks, combining electrical distribution, thermal management, and digital monitoring together from the outset. This integration is highly essential for supporting AI’s high-density workloads which rely on GPUs and specialized accelerators with intensive energy and thermal profiles.
The unified architecture offers a ready-to-use template that can be repurposed and repeated as often as needed, allowing operators to add capacity in repeatable increments resiliently and efficiently.
“For AI workloads, modular introduces standardized, repeatable building blocks, enabling rapid scale-out without redesigning each facility, delivering predictable performance and resilience from day one,” Sarao said.
Today, adoption of modular data center designs are driven by three key factors: aggressive construction cycles driven by AI, growing demand for power availability and interconnection, and labor and supply chain constraints that often slow down construction.
Another big driver is rising rack densities. According to Uptime, AI pods are reaching 1MW. This demands integrated power and cooling from day one. Prefab and pre-validated architectures provide this out of the box.
“Integrated power and cooling architectures are factory-optimized and tested, reducing inefficiencies during commissioning and enabling higher utilization from day one,” Sarao said.
An underrated benefit of modular designs is their low carbon footprint. Historically, construction methods have been curated for speed, durability, and standardization. The fallout of that is high carbon emissions, which, although categorized as secondary effects fall under Scope 3 emissions.
Factory-based construction minimizes material waste and rework, and cuts down logistical and site activities, thus helping bring down the overall environmental footprint of the build.
Additionally, advanced cooling units in modular systems are built to support tighter thermal control and energy management and reduce water and energy consumption, all of which may advance operators’ sustainability goals.
Today, the biggest consumers of modular data center infrastructure are the usual suspects. “The strongest demand comes from hyperscale and colocation providers scaling AI-ready capacity, where speed, repeatability, and risk reduction directly translate into faster revenue realization,” Sarao said.
A growing number of infrastructure vendors are expanding their modular portfolios to meet this demand. Schneider Electric offers smart modules under its EcoStruxure architecture, that include all-in-one IT enclosures to complete modular data halls. Vertiv is also expanding manufacturing capacity for prefab modular systems aimed at AI deployments. Its SmartMod portfolio, focused on delivering rapid deployment without compromising operational performance, offers 2 to 14 rack deployments with 100kW and under. Eaton’s modular solutions, custom-engineered to site specifications, provide infrastructure that integrate both power, HVAC and IT equipment to accelerate deployment timelines.
Meanwhile, Huawei remains one of the largest modular data center solutions vendors globally with its FusionModule platform, which combines integrated power, cooling, and IT infrastructure in prefab systems of varying size and capacity.
