Data center liquid cooling market heats up

The heat-management capabilities enabled by liquid cooling are in demand as deployments of advanced processors and high-performance servers continue to grow. Looking ahead, Dell’Oro Group says liquid cooling will start to become a mainstream technology in the second half of 2024, and the market will grow to more than $15 billion over the next five years.

“Historically, liquid cooling vendors touted increased efficiency and sustainability as factors behind the technology’s adoption,” said Lucas Beran, research director at Dell’Oro Group and author of the firm’s Data Center Liquid Cooling Advanced Research Report. “While those benefits remain true, it’s proved to be the increased thermal management performance capabilities, meeting the particularly demanding thermal requirements of high-end processors and accelerated servers, that is the current driving force behind its adoption.”

Accelerated servers equipped with GPUs and custom accelerators accounted for more than half of all server sales in the first quarter of 2024, Dell’Oro reported. In addition, AI network requirements will accelerate the transition to higher speeds and advanced heat management. The majority of the switch ports deployed in AI back-end networks are expected to be 800 Gbps by 2025 and 1600 Gbps by 2027, Dell’Oro reported.

Types of liquid cooling

The Dell’Oro report looks at three liquid-cooling technologies: rear door heat exchangers, direct-to-chip, and immersion. 

Rear door heat exchangers typically reside on individual servers racks and involve a condenser unit at the back of the rack that delivers the cold liquid and removes the heat generated by the servers. “The important thing about rear door heat exchangers is that it doesn’t require modification to the IT gear, and so that makes it a lot more simple to deploy in an infrastructure that isn’t designed for liquid cooling,” Beran said. 

Direct-to-chip liquid cooling technology requires changes to existing equipment and involves a cold plate residing on top of a processor with a tube coming out of the server. This configuration of the technology is what’s known as single-phase direct-to-chip liquid cooling (DLC). Dual-phase versions of direct-to-chip packages utilize liquid and vapor phases of a coolant to even more efficiently disperse heat from the chip.

Single-phase DLC deployments are scaling first, Beran said. “This is the result of long-standing adoption in the high-performance computing industry that has helped establish a more mature vendor ecosystem and end-user know-how to deploy and service the technology, Beran said. 

Single-phase DLC is the leading data center liquid cooling technology, and that’s expected to continue throughout the five-year forecast period, Behran said. However, two-phase DLC is forecast to materially grow during the forecast period, Behran said. Ultimately, fluid innovation is going to play a big part in how successful immersion cooling will be, Beran said.

In terms of data center liquid-cooling revenues in 2023, CoolIT Systems, Boyd, and Motivair are the top three vendors, Beran said. He noted, too, that Nvidia has specified single-phase DLC as the cooling technology to support its upcoming GB200 compute nodes.

The high end of the Nvidia GB200 lineup, the NVL72 system is a 72-node, liquid-cooled, rack-scale system for the most compute-intensive workloads. Each DGX GB200 system features 36 Grace Blackwell Superchips — which include 72 Blackwell GPUs and 36 Grace CPUs — connected by the newest generation NVLink interconnect technology.

The third technology forecast in the Dell’Oro report – immersive cooling – involves physically submerging servers, networking or other gear directly into a non-conducting liquid which acts as a coolant, directly absorbing heat generated by the components and transferring it away from the equipment. Immersion cooling technology supports higher server densities in a data center compared to traditional air cooling.

“There’s a lot of interest in immersion cooling because, from an engineering perspective, that’s going to give you that best thermal management performance. [It delivers] a better thermal management performance than direct-to-chip liquid cooling, because there’s no air cooling associated with it, and you can capture nearly 100% of the heat generated by the server. So, that immediately sets businesses up for the opportunity to achieve the best energy efficiency,” Beran said.

But the technology, complexity and the ecosystem around immersion cooling are slowing its adoption, Beran said. 

“With immersion cooling tanks, you need to have your cables be compatible and work with immersion cooling tanks, you need to have contractors that know how to deploy this infrastructure, how to design this infrastructure,” Beran said. “And there’s just so much education required for immersion cooling, versus other forms of liquid cooling, such as direct-to-chip liquid cooling. But there’s more steps and more people that need to be involved for immersion cooling.”

Still, single-phase immersion and two-phase direct-to-chip are undergoing testing, validation, and proof-of-concept work, which is materializing in growing pipelines for those vendors. Two-phase immersion, which involves liquid immersion and vapor collection, on the other hand, is facing an uphill battle towards adoption, as it remains particularly challenged by the regulatory environment surrounding PFAS fluid use, Beran said. 

PFAS, or Per- and Polyfluoroalkyl Substances, are the class of chemicals used in immersion cooling. 3M, which is one of the largest producers of PFAS, said in 2022 that it would stop making and using PFAS materials for environmental reasons by the end of 2025, which has dented the immersion technology field, according to experts.

“There’s still a lot of innovation, and my research shows that I do believe there’s an opportunity for immersion cooling. It is going to have a place in this market over the next five years,” Beran said. “But at the end of my forecast period, single-phase direct-to-chip liquid cooling is still, you know, over half the market, and immersion cooling is less than 25%.”

LiquidStack demos liquid cooling at Cisco Live

At the recent Cisco Live event, one of the developers of immersion cooling technology, LiquidStack, ran a popular demonstration of its technology.

“I think our customers are going to have to make a decision about this technology, which is at an early stage right now,” said Bill Gartner, senior vice president and general manager of Cisco’s optical systems and optics group at the event. “Liquid immersion is probably expensive, but customers will trade that off against the cost of power to run data center and AI systems efficiently in the future.”

Other players in the immersive arena include Submer, Aperitas, Fujitsu and Green Revolution Cooling.

Read more about liquid cooling

• Is immersion cooling ready for mainstream?
• Data center cooling: Pros and cons of air, liquid and geothermal systems
• Data centers warm up to liquid cooling
• Schneider Electric shares liquid cooling guidelines
• Accelsius offers liquid cooling without a data center retrofit
• ZutaCore launches liquid cooling for advanced Nvidia chips
• Intel and Vertiv partner to liquid cool AI processors
• Lenovo adds new AI solutions, expands Neptune cooling range to enable heat reuse
• Supermicro has a new liquid-cooled server for AI