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Data Centers in China

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Explore Markets in China

China – Unparalleled Scale for a Digital Superpower

Executive Summary

China's data center market is engineered for massive scale, serving the world's largest domestic internet population. With over 115 facilities, as of September 2025, it is the essential, though highly regulated, environment for global enterprises and cloud companies aiming to deliver low-latency services inside the Great Firewall. Success in China requires navigating a unique operational landscape, but the access to its vast digital economy is the ultimate prize.

China: At A Glance

FactorRating / DataNotes
Global Connectivity GradeA+Extremely dense domestic connectivity, with regulated international gateways.
Direct Cloud On-RampsOver 4 – as of September 2025Direct connections are available to major cloud providers, including AWS.
Power CostUS$0.08/kWh – as of Q2 2025Globally competitive pricing supports high-density deployments.
Disaster RiskLow (3.0/10) – as of September 2025Overall national risk is low, but specific regional hazards vary significantly.
Tax IncentivesNoData center owners have advocated for maintaining renewable energy subsidy rules.
Sales Tax13% VAT (standard rate) – as of September 2025Reduced rates of 9% and 6% apply to specific goods and services.

Network & Connectivity Ecosystem

China’s digital infrastructure is a vast, state-of-the-art ecosystem built to serve over a billion internet users. While international connectivity is tightly controlled, domestic performance is exceptional.

Carrier Density & Carrier Neutrality: The market includes over 20 major providers, as of September 2025, with state-owned enterprises like China Telecom, China Unicom, and China Mobile playing a dominant role. Carrier-neutral facilities are concentrated in key economic hubs, offering access to this dense network fabric.

Direct Cloud On-Ramps: Over 4 dedicated cloud on-ramps provide direct, private access to 2 major cloud regions within the country, as of September 2025. These connections are critical for hybrid cloud architectures requiring stable, high-throughput links to providers such as AWS.

Internet Exchange Points (IXPs): Public peering is less common than in other markets. The majority of traffic exchange occurs through government-operated internet exchanges (like CNIX) or via extensive private peering agreements directly between major content and network providers.

Bare Metal: Bare metal cloud solutions are available from select global providers, offering dedicated compute resources for performance-sensitive applications that must be deployed within China's borders.

Power Analysis

Power infrastructure in China is a core component of its national strategy, offering both competitive pricing and high reliability in its primary data center clusters.

Average Cost Of Power: At US$0.08/kWh for industrial use, as of Q2 2025, power costs are among the most competitive in the Asia-Pacific region. This pricing advantage is a key enabler for energy-intensive workloads like AI training and large-scale data analytics. The grid is powered by a mix of fossil fuels (~65%), renewables (~30%), and nuclear (~5%).

Power Grid Reliability: The power grid supporting major economic zones like Beijing, Shanghai, and the Pearl River Delta is modern and reliable. Data centers in these areas are typically served by redundant power feeds from multiple substations, ensuring high levels of uptime for mission-critical operations.

Market Access, Business & Tax Climate

Deploying infrastructure in China is fundamentally about accessing its enormous and highly active domestic market.

Proximity To Key Business Districts: Data center clusters are strategically located near China's primary economic engines. Facilities around Beijing serve the government and tech sectors, those in Shanghai support the financial and commercial industries, while the Pearl River Delta (Guangzhou and Shenzhen) is the hub for manufacturing and technology hardware.

Regional Market Reach: A presence in China provides direct, low-latency access to the country's massive population. It is not a hub for serving other APAC nations; it is a self-contained market of unparalleled scale.

Tax Advantage For Data Centers: While direct tax incentives for data centers are uncommon, the government's strategic promotion of digital infrastructure creates a stable operational climate. The primary financial driver is not tax relief but the immense revenue opportunity from accessing the world's largest single digital market.

Natural Disaster Risk

China's overall INFORM Risk score is Low (3.0/10), as of September 2025, but its vast geography means regional risks vary significantly and require site-specific evaluation.

Key natural hazards to consider based on facility location include:

  • River Flood: A high-risk factor in several major river basins, including the Yangtze and Yellow Rivers.
  • Coastal Flood & Tsunami: A consideration for facilities located in low-lying areas along China's extensive eastern and southern coastlines.
  • Tropical Cyclone: Typhoons frequently impact the southern and eastern coastal provinces during the storm season.
  • Earthquake: Seismic risk is elevated in specific zones, particularly in the western and southwestern regions of the country.
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