In brief
▶ LG Electronics said on the 6th that its U.S. subsidiary had signed a definitive long-term chiller supply agreement with North American data center infrastructure platform company Air Control Concepts.
▶ The company will supply high-efficiency chillers and other cooling equipment in stages for data centers with a combined capacity of 5 gigawatts.
▶ According to Omdia, global data center power demand will rise by 108 GW, from 226 GW in 2026 to 334 GW in 2027. The 5 GW covered by the agreement is about 5% of that increase.
LG Electronics has secured a major long-term contract in the North American AI data center cooling market. The company said on the 6th that its U.S. subsidiary had recently signed a definitive long-term chiller supply agreement with Air Control Concepts (AIR), a North American data center infrastructure platform company.
Under the agreement, LG Electronics will supply high-efficiency chillers and other cooling equipment in stages to manage heat at data centers with a combined capacity of 5 gigawatts (GW). The contract value was not disclosed.
A chiller is a cooling system that produces large quantities of chilled water. Whether it is used to cool the air in server rooms or to circulate coolant directly through chips, data center cooling starts with the chilled water produced by a chiller.
Five gigawatts represents the amount of power the data centers can use, equivalent to the output of five nuclear power plants. According to market research firm Omdia, global data center power demand is expected to rise by 108 GW, from 226 GW in 2026 to 334 GW in 2027. The 5 GW secured by LG Electronics is about 5% of that annual increase.
◆ Long-term guarantees instead of bidding
AIR, the counterparty to the agreement, handles the entire process for AI data centers in the United States and Canada, from design and construction to public procurement and after-sales service. It carries out large-scale projects through its data center-focused subsidiary, AMC, and counts major data center operators worldwide among its customers. LG Electronics describes AIR as a key partner in the AI data center sector.
LG Electronics said the agreement has two important implications: its cooling equipment has met the demanding technical and reliability standards of hyperscale data centers, and it has secured a place as a key infrastructure partner in the North American supply chain through a long-term contract that guarantees volume, rather than one-off deals won through project-by-project bidding.
AIR CEO Brad Hobbs said LG Electronics’ high-efficiency chiller technology would enable the company to provide proven solutions as it builds out its data center portfolio.
◆ From cool air to chilled water
The agreement could lead to additional business. As the number of GPUs used for AI computing grows, the power consumption and heat output of individual server racks have surged. Air cooling, which circulates cold air, is no longer sufficient on its own, and liquid cooling—which sends chilled water directly to chips—is becoming more widespread.
LG Electronics and AIR are discussing expanding the range of products supplied to include coolant distribution units (CDUs), a key component of liquid cooling. A CDU distributes chilled water produced by a chiller to individual server racks and returns the water after it has warmed.
LG Electronics is promoting its “chip-to-chiller” solution, which covers the entire thermal management chain, from chillers to chip cold plates.
◆ 600 billion won in orders in the first half; several trillion won expected by year-end
LG Electronics’ data center cooling business is growing rapidly. Orders for AI data center cooling exceeded 600 billion won in the first half of this year, and the company expects cumulative orders to reach several trillion won by year-end. It also expects to bring forward its target of 1 trillion won in chiller revenue, which had been set for the end of 2027.
The company is also building a track record of supplying equipment. It has been supplying and installing cooling equipment this year at a major North American data center for which it won an order last year, and has secured major data center supply projects in the Middle East and Indonesia as well.
LG Electronics is drawing on 60 years of experience providing heating, ventilation and air-conditioning systems for facilities that require high reliability, such as nuclear power plants and large hospitals. On the 1st, it also announced a 150 billion won investment to build a chiller factory in Virginia and expand its production lines in Pyeongtaek and Changwon.
Market research firm Fortune Business Insights projects that the global AI data center market will grow by about 26% annually to reach approximately $133.5 billion (about 185 trillion won) by 2034.
Lee Jae-seong, president of LG Electronics’ ES Business Division, said the company would lead the global AI data center cooling market by drawing on its differentiated technologies—including high-efficiency chillers and high-performance liquid cooling solutions—and its rapidly growing experience supplying large-scale data centers.