Data Center Cooling Infrastructure: The Global Constraint for Next-Generation AI Computing

This article is the second in a two-part series examining critical data center infrastructure. Part 1 focused on power infrastructure.

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What You'll Learn

• How cooling systems consuming up to 40% of data center energy impact operational costs worldwide

• Why traditional air cooling physically cannot support next-generation AI hardware in any climate

• How cooling challenges manifest differently across developed and emerging markets

• Which cooling technologies are best suited for diverse geographical contexts

• What strategic considerations should guide cooling infrastructure investment decisions globally

• How NVIDIA's March 2025 announcements fundamentally change data center design requirements

Introduction

At NVIDIA's GTC conference in March 2025, Jensen Huang revealed plans for the Vera Rubin Ultra architecture requiring racks supporting an extraordinary 600kW of power by 2027.

This announcement represents more than an incremental advancement.

It establishes cooling infrastructure as the critical constraint for next-generation AI computing worldwide.

The thermal profile of data centers has evolved dramatically in recent years. Where traditional servers once generated 3-5 kW per rack, today's AI and high-performance computing environments produce 30-150+ kW.

This exponential increase has transformed cooling from a background utility to a strategic differentiator that directly determines which facilities can host the most valuable workloads.

This challenge manifests differently across global markets.

In temperate regions, the primary concern is achieving sufficient cooling density. In tropical climates like Southeast Asia, South America, and Africa, facilities must contend with ambient temperatures exceeding 30°C and humidity levels above 90%, which fundamentally reduce cooling efficiency.

In water-stressed regions, cooling solutions that consume millions of liters daily face both practical and social license constraints.

This article analyzes how cooling technologies are evolving globally, examines the diverse challenges across regions, and offers strategic considerations for stakeholders navigating this rapidly changing environment.

This is the second in a two-part series examining critical data center infrastructure. Part 1 focuses on power infrastructure.

The Thermal Economics Framework

According to the Uptime Institute's 2022 Global Data Center Survey, cooling systems consume up to 40% of data center energy worldwide. This substantial proportion makes cooling efficiency a primary determinant of operational costs and environmental impact across all markets.

The industry standard for measuring efficiency is Power Usage Effectiveness (PUE), calculated as the ratio of total facility energy to IT equipment energy. Uptime Institute's research indicates the average data center PUE has improved marginally to 1.55, down from 1.57 in 2021.

However, hyperscale operators have achieved PUEs as low as 1.2, creating a significant competitive advantage in operational costs. For large-scale facilities, this efficiency differential represents millions of dollars annually in energy expenditure.

Beyond direct energy costs, cooling infrastructure limitations create substantial hidden costs through constraints on computing capacity. The physics of heat transfer has established a new global market segmentation based on cooling capabilities:

• Tier 1: Liquid-cooled facilities capable of supporting 30-150+ kW racks where high-margin AI workloads run

• Tier 2: Enhanced air-cooled facilities maxing out at 15-20 kW per rack, competing for increasingly commoditized general workloads

• Tier 3: Legacy facilities with standard cooling struggling to maintain relevance as compute densities increase

This three-tier segmentation has significant implications for facility valuation and investment returns across all markets. While advanced cooling technologies require higher initial capital expenditure, they enable higher revenue potential through increased compute density and the ability to host premium AI workloads.

Google's implementation of AI-optimized cooling demonstrates the potential return on investment.

According to a case study published by Google in 2023, the company achieved approximately 40% reduction in cooling energy by using neural networks to optimize cooling operations.

This approach represents a particularly attractive investment profile: software-based optimization that enhances the performance of existing physical infrastructure.

Regional Cooling Challenges and Solutions

Cooling challenges vary significantly across global regions, requiring tailored approaches to address local conditions.

Developed Markets (North America, Western Europe)

In temperate regions like North America and Western Europe, the primary cooling focus has been achieving extreme density capabilities for AI acceleration.

Urban space constraints in major data center hubs drive the need for efficiency and higher rack densities. These regions benefit from cooler climates that enable free cooling opportunities for substantial portions of the year, significantly reducing operational costs.

According to the U.S. National Renewable Energy Laboratory, data centers in northern climates can achieve free cooling for 75% or more of annual operating hours, compared to less than 25% in tropical regions. This natural advantage is increasingly factored into site selection decisions for high-performance computing facilities.

The major challenge in these markets is transitioning from traditional air cooling to liquid-based methodologies to support next-generation AI hardware. Retrofitting existing facilities presents significant challenges, while new purpose-built data centers increasingly incorporate liquid cooling from initial design.

Tropical Emerging Markets (Southeast Asia, parts of South America, Africa)

Tropical regions face compound challenges of high ambient temperatures (often exceeding 30°C year-round, with peaks up to 40°C) and extreme humidity levels frequently above 90%.

Research from the Sustainable Tropical Data Centre Testbed (STDCT) demonstrates that this high humidity fundamentally reduces the effectiveness of evaporative cooling, a common efficiency technology in developed markets.

In Singapore, cooling towers struggle to reject heat effectively in humid environments, forcing systems like compressors to work harder and increasing energy consumption.

According to studies published by STDCT, maintaining a Power Usage Effectiveness (PUE) of ≤1.3 is challenging in Singapore due to heat rejection difficulties in high-humidity conditions.

Malaysia's data centers face thermal runaway risks from AI workloads, necessitating specialized solutions.

According to research from the National University of Singapore, a 100 MW data center in Malaysia uses approximately 4.2 million liters of water daily—equivalent to a city of 10,000 people—creating substantial sustainability concerns.

Arid Emerging Markets (Middle East, parts of Africa)

Water scarcity presents a critical challenge in arid regions. Traditional cooling towers can consume millions of gallons of water annually, creating both environmental and operational risks.

For instance, Google's planned data center in Uruguay, projected to consume 7.6 million liters of potable water daily, has faced local opposition, highlighting the social license issues surrounding water-intensive cooling.

In water-stressed regions, closed-loop systems that minimize or eliminate water consumption are gaining traction. According to case studies documented by SkyCool Systems, their passive cooling panels can eliminate water use while cutting energy consumption by 50–70% in appropriate climates.

These regions are also exploring integration of thermal storage solutions to shift cooling loads to nighttime hours when ambient temperatures are lower and electricity is potentially less expensive.

The Cooling Technology Spectrum

Data center cooling technologies exist along a spectrum from traditional air-based approaches to advanced liquid cooling methodologies, each with different capabilities, efficiency profiles, and density limitations.

Air Cooling Approaches

Traditional air cooling remains the predominant approach in existing facilities worldwide.

These systems utilize Computer Room Air Conditioners (CRAC) or Computer Room Air Handlers (CRAH) to maintain appropriate temperature and humidity levels.

According to Vertiv's educational materials on data center cooling systems, modern implementations incorporate hot/cold aisle containment, variable frequency drives, and sophisticated airflow management to optimize efficiency.

However, air cooling faces fundamental thermodynamic limitations in all climates.

According to engineering principles documented by ASHRAE, air has approximately 3,500 times less heat capacity than water, creating inherent inefficiency when removing heat from densely packed equipment.

These limitations become particularly apparent in racks exceeding 15-20 kW, where ensuring adequate airflow without hotspots becomes progressively more challenging.

Liquid Cooling Technologies

The thermal limitations of air have accelerated adoption of various liquid cooling methodologies globally:

Direct-to-Chip Liquid Cooling delivers coolant directly to heat-generating components through specialized plates attached to processors, GPUs, and memory modules.

According to research published by Flex in their "Future of Data Centers" report, this targeted approach eliminates the inefficiency of cooling entire air volumes and can operate with higher temperature coolant, increasing overall system efficiency.

In tropical regions like Malaysia, Iceotope's hybrid cooling approach combines direct-to-chip with immersion cooling, reducing water use by 91% and operating efficiently at ambient temperatures of 28–29°C.

Immersion Cooling submerges IT equipment in dielectric fluids that directly contact components without causing electrical damage.

According to a study published in the ASME Digital Collection on InterPACK 2022, single-phase systems maintain the coolant in liquid form, while two-phase systems utilize the phase change from liquid to vapor for enhanced heat transfer.

These approaches are particularly effective for AI workloads, with immersion cooling supporting rack densities exceeding 150 kW. In the UAE, Green Revolution Cooling (GRC) and Dell have deployed immersion-cooled modular data centers targeting 48% lower energy footprints compared to traditional approaches.

Hybrid Cooling Systems combine air and liquid approaches, allowing operators to tailor solutions based on workload intensity and regional conditions.

According to Utility Dive's 2025 outlook report on data center cooling, air cooling might suffice for lower-density applications like archived data, while liquid cooling is deployed for high-performance tasks like generative AI.

In regions with unstable power like parts of Africa and Southeast Asia, hybrid systems ensure resilience during fluctuations.

The efficiency differences between these technologies are substantial across all climates.

Research from the ASME Digital Collection indicates that transitioning to 75% liquid cooling can reduce facility power use by 27% and total site energy by 15.5%. For large-scale operations, these savings translate to millions of dollars annually while simultaneously enabling higher compute densities.

Global Leaders and Regional Specialists

The data center cooling market features established global providers alongside specialized technology firms and regional players addressing market-specific constraints.