Data center operators have been adept at keeping the increase of power usage at a slower rate than the volume of data. Now they are finding that controlling power usage efficiency, or PUE, is a growing challenge given prevalent cooling technology. 

Emerging computing technologies such as fintech, blockchain and crypto currency mining require energy-intensive, high-performance computing (HPC), which uses clusters of servers to carry out complex functions.  

“The data center market is expecting growth of HPC driven by digitalization and the democratization of big data, automation, AI, IoT to many more companies and organizations,” Valentina Serra-Holm, vice president of engineered fluids at Swedish chemicals company
Perstorp, told Lubes’n’Greases.  

HPC and the growth of users could push data center power consumption up to 13% of the world’s total in the next 10 years. Operators are therefore looking for consumption reductions in PUE.  

“There were a lot of levers to pull to ensure that the existing data centers are able to manage their power demand more effectively,” Yana Wilkinson, global leader of the energy practice at Kline & Co., said at the ICIS World Base Oil & Lubricants conference in February. “As the number of data centers has grown, some of those levers were exhausted, and progress and efficiency has stalled.” 

Market Complexity and Drivers 

The scale and function of data centers differ based on requirements, geography and technology. They also employ different cooling solutions. Some are air cooled, some liquid cooled and a small yet growing number are immersion cooled with a dielectric fluid in contact with the servers themselves.  

Currently, about 1% of the world’s data centers are immersion cooled. Demand for immersion cooling fluids stands at 20,000 metric tons per year, according to Kline. 

“As the computer and server hall industry move on into ever-faster computing as more of a mid-tier offering, the energy losses will become staggering,” Thomas Norrby, technical manager of lubricants and electrical industry at Swedish lubricant company Nynas, told Lubes’n’Greases. 

As demand increases for immersion cooling, certain data centers will have specific fluid requirements, value profiles and overall growth expectations, Wilkinson explained.  

With hyperscale data centers on one end of the spectrum and so-called Edge modular systems that operate closer to end users on the other, there is no one-size-fits-all fluid solution or demand profile. While there is a disproportionate concentration of demand from hyperscale centers in certain locations, the number of Edge data centers will likely grow and shift geographic and technological demand elsewhere.  

“It’s very important also to consider what flavor of growth drivers are going to reshape these geography and demand parameters,” Wilkinson said. “Not all data is the same flavor, and not all data drives the same type of data centers to grow and expand.” 

Wilkinson also cautioned that companies trying to enter the market need to have a deeper understanding of the market drivers than first imagined. It is not enough to base marketing strategies on simple observations that cloud computing is driving growth for smaller, localized data centers while AI might require huge hubs. 

“You will need to understand a lot more—with the profile of performance and cost that your product is offering—which sub-segment of the industry is going to be most open and receptive to your particular customer value proposition,” Wilkinson said. “This is not an easy industry to understand, and not everything is going to be driven by the same type of drivers … The situation is fluid.” 

Wilkinson also thinks it is essential to connect demand for your product to a specific application and customer, as well as to keep track of market developments from the customer perspective, rather than through the lens of the product offering.  

“Immersion cooling is an opportunity for diversification within our existing molecules; it’s always important to ground ourselves in jobs to be done,” she said. 

Who Can Play? 

The immersion cooling fluid market is garnering attention across industries. It is an opportunity for base oil, chemical and lubricant companies alike to leverage expertise in thermal management and dielectric fluids.  

“There are broad similarities between dielectric fluids applied for various technical uses, so the approach can be from many different angles. You need to understand the business, as always,” Norrby said.  

Companies already in the market include major base oil players, chemicals companies and finished lubricant manufacturers, such as SK, Castrol, Ineos, Mvolt, Honeywell, ExxonMobil and Lubrizol, among others. Each offers one of more than 30 solutions in the market, including esters and polyalphaolefins. 

“Ongoing advancements in immersion cooling technology and the development of dielectric fluids with enhanced cooling properties make it an appealing market for new players,” Serra-Holm said. “Partnerships and collaboration are key to any player entering the immersion cooling space.” 

Even though the market is small, it is also complex, and not all potential players have what it takes to enter. Companies need more than the right molecule or base fluid to succeed, Wilkinson said. They need the ability, agility and technical competence to serve large organizations with fast-evolving needs. 

“Delivering fluid as a service is a very different capability versus delivering a product, so companies that are able to convert their product into a solution will be best placed to play,” Wilkinson said. “Chemistry is widely available, but can you correctly position your customer value proposition? This is the question.” 

There are other links in the supply chain that also have exacting performance specifications and play an important role, such as chip manufacturers, hardware companies and engineering solutions providers.  

“It’s an industry with a very low threshold for failure,” Serra-Holm told Lubes’n’Greases.  

Sustainability Push 

Wider adoption of immersion cooling is being driven by similar concerns experienced across the economy, as much as fluid performance.

Pressure on companies to operate sustainably and to report on sustainability activities is mounting across the world, most acutely in the United States and the European Union, where there are regulations controlling water and power use.  

Data centers collectively use billions of gallons of water each year for their cooling and power generation.  

In the traditional lubricant space, product value can often be assessed by market size and application-specific demand. But, Wilkinson thinks, greater emphasis should be placed on whether these two factors can be met sustainably as well. Sustainability can be considered from several angles—from the carbon footprint of the fluid itself and the raw materials used in its manufacture to the facility’s resource efficiency and fluid life cycle management. 

Data center boardrooms are sensitive to carbon neutrality and water use, especially if this is a key performance indicator linked to executive salaries. 

“We also see demands for sustainability and resource efficiency,” Wilkinson said. “We have scarcity of all the key components that drive and power data centers.” 

Serra-Holm agreed, explaining that “aspects such as power, water and carbon usage efficiency and higher computing density are driving a shift from air cooling to liquid immersion cooling, as the latter enables a significant reduction of a data center’s environmental impact.”

Outlook 

Whether or not the fluid remains financially sustainable depends on cost, Norrby posited.  

“Any technology that is too expensive will remain niche. Real, documented sustainability—well-supported by life cycle assessments—will hopefully help create a level playing field,” Norrby told Lubes’n’Greases. “If the solutions remain exotic, the application and usage will remain niche.” 

Like his colleagues, Norrby is positive about the market. 

“I sense a favorable lining up of several stars: sustainability, energy conservation and a rise in high-power computing,” he said.  

There are barriers to entry beyond a company’s agility and market depth perception, though. The operational specifications, material compatibility and safe handling requirements significantly differ between these fluids and other mainstays of the lubricants industry, Serra-Holm said.  

“The development of specific fluids will most likely follow separate tracks,” she said. “Value chain characteristics also play a role in this. While EV battery development is in the hands of a few players and driven by OEM requirements, immersion cooling is driven by an industry-wide co-development and accelerated by a cross-industry cooperation.” 

Despite the potential for significant growth, there is no wide-scale in-use documentation of fluid lifetime. The current specification is 10 years, which is what fluid manufacturers are testing for, Serra-Holm explained. But it could be less—or more—making forecasting volume sales a challenge.  

“We can anticipate that there will be a need for refill during maintenance cycles and/or when servers or other components are changed,” she said.  

Fluid approval is arduous, according to Serra-Holm. The technology is still in the development stage, and fine tuning will be ongoing in the years to come. 

As for prevailing chemistries, synthetic esters and specifically polyol ester-based fluids are a strong candidate. The main factors that will determine chemistries for immersion cooling fluids are current and future chemical regulations, component manufacturer specifications as well as customer preferences. 

Whatever molecule wins out, the capacity and the amount of data being processed are growing exponentially.  

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Simon Johns is an editor with Lubes’n’Greases. Contact him at Simon@LubesnGreases.com.