1- Install AccessDatabaseEngine_x64.exe or AccessDatabaseEngine.exe if you are using 32 bit version of windows (Restart is required).
2- If you are using SQL Management Studio, run Management Studio as administrator. If you don’t run it as an administrator account you will have this error (Cannot initialize the data source object of OLE DB provider "MICROSOFT.ACE.OLEDB.12.0" for linked server "(null)".
3- Run this command to configure your Database
EXEC sp_configure 'show advanced options', 1;
RECONFIGURE with override;
GO
EXEC sp_configure 'Ad Hoc Distributed Queries', 1;
RECONFIGURE with override;
GO
EXEC master . dbo. sp_MSset_oledb_prop N'Microsoft.ACE.OLEDB.12.0' , N'AllowInProcess' , 1
GO
EXEC master . dbo. sp_MSset_oledb_prop N'Microsoft.ACE.OLEDB.12.0' , N'DynamicParameters' , 1
GO
4- Don’t use ‘select * from sheet1$’ in OPENROWSET function. Try this code.
select * from OPENROWSET('MICROSOFT.ACE.OLEDB.12.0', 'Excel 12.0;HDR=YES;DATABASE=D:\test.xlsx', sheet1$)
If still you have (32 bit) error, try to restart your SQL service and check your C:\Windows\Temp and see do you have access to this directory or not.