If you’ve been investing in Taiwan’s stock market recently, you might have come across BBU concept stocks. With the AI server boom, the power stability demands of data centers have drawn significant attention. Recently, news emerged that NVIDIA plans to make BBUs (Battery Backup Units) a standard feature in its GB200 systems, shifting from optional to default. This strong demand has sparked a surge in BBU-related stocks.
Today, fiisual will guide you through the basics of BBUs and explore key Taiwanese companies involved in the BBU supply chain.
What is a BBU?
A BBU (Battery Backup Unit) is a battery-powered backup module designed for data centers and server systems. When power outages or instability occur, the system switches to the BBU, providing short-term power to:
- Rapidly transfer cached data from DRAM to SSD storage to prevent data loss.
- Rebuild the system state by retrieving data from SSDs once power is restored.
BBU vs. UPS: A Technical Comparison
| Feature | UPS | BBU |
|---|---|---|
| Power Conversion Efficiency | Lower (AC to DC, ~88%) | Higher (DC to DC, up to 98%) |
| Space Utilization | Larger, requiring dedicated space | Compact, rack-integrated |
| Battery Type | Lead-acid (shorter lifespan, slower charging) | Lithium-ion (longer lifespan, faster charging) |
| Backup Duration | Longer | Approx. 4 minutes |
BBUs outperform traditional UPS systems in terms of efficiency, compactness, and environmental benefits (lead-free design). They ensure that critical data in DRAM is safely transferred during power interruptions, providing a vital safeguard for servers and data centers.
Future Applications of BBU Technology
While current discussions focus on AI servers and data centers, BBU technology has broader potential applications in industries requiring uninterrupted power supply. Prominent examples include:
- AIoT (Artificial Intelligence of Things) for edge computing.
- 5G Base Stations.
- In-vehicle computing systems in electric and autonomous vehicles.
BBU Supply Chain
As AI technology advances, data centers increasingly rely on stable power solutions. BBUs are poised to play a central role, with several Taiwanese companies positioned as key players in the supply chain.
Battery Modules
Battery module manufacturers such as Dynapack (3211) and STL Technology (4931) supply battery modules to major power companies and are actively expanding into the data center BBU (Battery Backup Unit) market. Dynapack (3211), in particular, has been a key supplier for Meta, leveraging its extensive experience in the power supply market and maintaining long-term partnerships with Delta Electronics(2308) and Lite-On Technology (2301).
Meanwhile, new entrants are also making strides in the industry. E-One Moli Energy, a subsidiary of Taiwan Cement Corporation (1101), has successfully positioned its Molicel battery cells within the AI server BBU supply chain. Since Q4 2024, the company has started shipping BBU units to major cloud service providers. Additionally, Ritek Group’s subsidiary, RiTdisplay (8104), is aggressively expanding into the energy sector through acquisitions, positioning itself to potentially enter the BBU supply chain.
Power Supply
Power supply manufacturers such as Delta Electronics (2308) and Lite-On Technology (2301) have been deeply involved in the uninterruptible power supply (UPS) sector for many years, offering UPS and BBU products while continuously launching high-performance power solutions. Moving forward, they are expected to actively collaborate with upstream battery module manufacturers to capture a larger share of the BBU market.
System Integration
System integrators such as Advanced Energy Solution (6781) focus on the research and production of lithium battery modules, with products covering server BBUs (Battery Backup Units). The company is recognized as one of the leading players in this field.
Thermal Solutions
Since BBUs generate additional heat and are installed within server racks, high-efficiency heat sinks are crucial for maintaining optimal performance. TaiSol (3338) plays a key role in the BBU supply chain by providing thermal management solutions. The company is currently expanding its overseas production capacity to strengthen its position in the thermal solutions market.
Conclusion
With the rapid growth of AI and data center technologies, BBUs are becoming indispensable in ensuring uninterrupted operations. Taiwanese companies are strategically positioned across the BBU supply chain, from battery modules to system integration and thermal solutions.
The continued adoption of BBUs by AI servers and data centers, along with emerging applications in AIoT, 5G, and automotive computing, highlights the immense growth potential of this sector.
