For most new AI-server deployments, direct-to-chip cooling is the better default. Cold plates remove heat from CPUs and GPUs, fit hybrid data-center halls, support phased installation, and preserve a familiar rack-service model. Single-phase immersion becomes the stronger choice when a purpose-built facility needs maximum heat capture, very high rack density, minimal room-air cooling, or warm-water heat reuse and can accept tanks, structural reinforcement, lifting equipment, dielectric-fluid handling, and new service procedures.
Two-phase immersion can transfer heat efficiently through boiling and condensation, but it adds fluid, environmental, and safety decisions. The right choice depends less on a headline efficiency number than on the complete design: rack power, facility heat rejection, water strategy, floor loading, maintenance, hardware qualification, and the cost of changing the operating model.
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The short decision
| Priority | Usually the better fit | Why |
|---|---|---|
| Broad server compatibility and phased deployment | Direct-to-chip | Cold plates and coolant-distribution units can be deployed rack by rack in a hybrid hall. |
| Maximum heat capture and the least room-air cooling | Single-phase immersion | The dielectric fluid surrounds the entire server and captures heat from all components. |
| Conventional rack access and familiar technician workflows | Direct-to-chip | Servers remain in standard racks, although coolant connections and leak controls must be added. |
| Purpose-built, extremely dense racks | Immersion | Tanks can support high heat density without relying on large volumes of moving air. |
| Highest confidence for a mixed existing facility | Direct-to-chip | It can coexist with air-cooled equipment and existing room infrastructure more easily. |
| Warm-water heat reuse and very low fan energy | Immersion, if engineered for it | Higher coolant temperatures and complete heat capture can simplify heat-recovery integration. |
There is no universal winner. A demonstration by KDDI, Mitsubishi Heavy Industries, and NEC Networks & System Integration reported a 94% reduction in server-cooling energy and a PUE of 1.05 for its Oyama immersion installation. That is a site-specific demonstration, not a universal head-to-head result for every direct-to-chip and immersion design.
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Direct-to-chip systems mount a metal cold plate on each major heat-generating component, normally a CPU, GPU, or accelerator. Coolant flows through channels inside the plate, absorbs heat, and returns through a manifold to a cooling-distribution unit (CDU). The CDU transfers heat to a facility-water loop through a heat exchanger while pumps regulate flow and pressure.
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The cold plate does not cover every component. Memory, voltage-regulation circuitry, storage devices, network adapters, and other parts may continue to use local fans and room air. Tetra Tech’s High Performance Buildings Group estimated that direct-to-chip can capture up to 80% of total server heat, leaving roughly 20% for air cooling. The exact split varies with the server design and workload, so a facility must size both the liquid loop and the residual air system.
What the rack normally contains
- Cold plates matched to the processor or accelerator package.
- Supply and return manifolds with quick-disconnects or fixed connectors.
- Flexible or rigid hoses routed to a rack manifold or CDU.
- Flow, pressure, temperature, and leak sensors.
- A CDU that isolates the IT coolant from the facility-water chemistry.
- Fans for components that are not covered by cold plates and for room-level residual loads.
Because the server remains in a standard enclosure, direct-to-chip can be introduced in stages. The limitation is qualification: the cold plate, manifold, coolant, connector, leak-detection system, and server warranty must be approved as one operating system.
How immersion cooling works
Single-phase immersion
In single-phase immersion, complete servers are lowered into tanks filled with a dielectric liquid that remains liquid during normal operation. The fluid contacts processors, memory, power components, drives, and circuit boards, collecting heat from the entire server. Pumps circulate the warmed fluid through a heat exchanger or CDU, where heat moves to the facility loop before the cooled dielectric fluid returns to the tank.
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Tetra Tech describes single-phase immersion as capturing 100% of server heat. That eliminates most server fans and can sharply reduce the room-air system, but it changes the physical and operational design of the data center. Tanks occupy floor area, loaded tanks impose greater structural loads, and lifting equipment is needed to remove servers safely for service.
Two-phase immersion
Two-phase systems use a dielectric fluid that boils at the component surface. The vapor rises, condenses on a heat exchanger above the electronics, and returns as liquid. Phase change can provide strong heat transfer at high heat flux, but it introduces additional requirements for fluid selection, vapor containment, condenser design, environmental controls, and worker safety.
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Two-phase should therefore be treated as a specialized engineering project rather than a drop-in alternative to either cold plates or single-phase tanks. Confirm the fluid’s handling rules, long-term supply, material compatibility, environmental profile, and hardware warranty before selecting it.
Heat coverage, rack density, and floor space
The central thermal difference is coverage. A cold plate removes heat from selected chips; immersion removes heat from every submerged component. That distinction matters as accelerator boards, memory systems, and power electronics push rack loads upward.
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Density trade-offs
- Direct-to-chip: High-density GPU racks are practical when the server vendor supplies qualified cold plates and the facility can provide adequate flow and heat rejection. Residual air loads still require room cooling and airflow paths.
- Single-phase immersion: Better suited to a purpose-built hall where tank dimensions, floor loading, lifting paths, and fluid service areas are designed together. It can support dense compute with less fan and room-air infrastructure.
- Two-phase immersion: Potentially attractive for very high heat flux, but tank vapor space, condenser capacity, fluid controls, and safety zoning must be engineered for the specific load.
Do not compare rack density using IT watts alone. Include tank or CDU footprint, service clearances, pump and heat-exchanger equipment, electrical distribution, and the space needed to stage servers during maintenance.
Energy efficiency: PUE, pumping, and fans
The U.S. Department of Energy defines power usage effectiveness (PUE) as total annual data-center energy divided by annual IT-equipment energy. A lower PUE means less overhead energy for cooling, power distribution, lighting, and other facility systems. KDDI uses the same definition. A PUE figure is meaningful only when its system boundary, climate, operating load, and measurement period are stated.
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Liquid cooling can reduce fan energy because water-based coolant carries much more heat than air and can move that heat with pumps. Direct-to-chip sends heat into a recirculating chilled-water or warm-water loop instead of first moving it through room air. Immersion can remove even more fan and room-air work because the dielectric fluid contacts all components.
The Oyama demonstration by KDDI, Mitsubishi Heavy Industries, and NEC Networks & System Integration reported a 94% reduction in server-cooling energy compared with conventional cooling and achieved PUE 1.05. Those results belong to that installation and should not be used as a guaranteed value for another climate, workload, tank design, or heat-rejection plant.
What to measure in a real proposal
- IT input power, CDU or tank-pump power, fan power, chiller power, and heat-rejection power.
- Supply and return temperatures, coolant flow, pressure drop, and control set points.
- Performance at the intended rack load, not only at a lightly loaded test condition.
- Seasonal operation, including free cooling, economizer modes, and peak summer conditions.
- Separate readings for the liquid loop and for any remaining room-air system.
A vendor that reports only the pump or tank efficiency has not provided a facility PUE comparison. Require the calculation boundary and raw operating assumptions.
Water use and WUE
The Department of Energy defines water usage effectiveness (WUE) as annual site water use in liters divided by annual IT energy in kilowatt-hours. WUE must be measured at the facility boundary. A cold plate or immersion tank can be a closed recirculating loop while the heat-rejection plant still uses evaporative cooling towers.
A closed liquid loop connected to dry coolers can have little or no evaporative consumption. The same IT system connected to cooling towers may consume substantial water. The cooling method therefore does not, by itself, determine WUE. Compare the complete heat-rejection design, including makeup water, blowdown, treatment, and seasonal operation.
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Immersion may enable higher coolant temperatures, which can expand the hours when dry coolers or waterside economizers work without mechanical chilling. Direct-to-chip can also operate on warmer water when the server manufacturer qualifies the cold plates and components. Ask for the allowable supply and return temperatures rather than assuming that any liquid-cooled server accepts the same range.
Retrofit compatibility and facility design
When direct-to-chip can be retrofitted
Direct-to-chip is the more practical retrofit when the facility can route supply and return piping, install CDUs, reinforce rack power and cable paths, and maintain enough air cooling for uncovered components. A rack-by-rack rollout limits the initial disruption, but it is not a matter of attaching a generic water block to an existing server.
- Inventory the target servers, accelerator models, rack power, allowable coolant temperatures, and warranty requirements.
- Confirm that the server manufacturer or integrator approves the cold plates, manifolds, coolant chemistry, connectors, and leak-detection method.
- Check floor loading, pipe routes, CDU placement, electrical capacity, drainage, and emergency shutoff locations.
- Run a pilot rack with production monitoring before extending the design to the hall.
- Document service procedures for draining, disconnecting, replacing, refilling, and leak-testing a server.
Why immersion usually requires a redesign
Immersion tanks change the physical dimensions and mass of a rack. A tank full of dielectric fluid and servers can weigh far more than a conventional cabinet, so a structural engineer must verify slab capacity and point loads. Overhead lifting or another approved handling system is required to remove servers without spilling fluid or injuring technicians.
The facility also needs tank access, filtration, fluid storage, spill containment, draining and refill equipment, connector choices that tolerate the fluid, and a plan for cleaning contaminated hardware. Service areas must allow a wet server to be lifted, drained, inspected, and returned without bringing fluid into unrelated equipment rows.
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Maintenance, service, and failure modes
Direct-to-chip operating risks
- Leak or connector failure: Isolate the affected rack, close valves, follow the approved drain procedure, and inspect connectors and cold-plate seals before restoring flow.
- Restricted flow: Check filters, manifold valves, kinks, pump status, and pressure differential. A clogged filter can raise chip temperature before an alarm appears.
- Coolant chemistry drift: Test conductivity, corrosion inhibitors, biological control, and particulate levels against the server maker’s specification.
- Residual-air overload: If memory or power components overheat, verify that room airflow and blanking panels support the uncovered load.
Immersion operating risks
- Fluid contamination: Use filtration and scheduled sampling; particles, moisture, or incompatible materials can reduce dielectric performance and damage connectors.
- Tank temperature stratification: Check circulation patterns, pump capacity, heat-exchanger performance, and sensor placement.
- Service handling: Train technicians to power down, drain or allow drip-off, use lifting equipment, and protect fluid-sensitive work areas.
- Seal, vapor, or spill event: Follow the tank manufacturer’s containment and emergency procedures, including ventilation and approved cleanup materials.
Both methods need redundant pumps or a defined safe-shutdown strategy, leak detection, alarms integrated with facility controls, spare connectors and filters, and a documented response to loss of facility water. Liquid cooling reduces some failure modes but adds others; it does not remove the need for conventional availability engineering.
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Heat reuse and higher-temperature operation
Heat reuse is easier when the cooling loop delivers a stable, useful temperature to a nearby load such as a building-heating loop, industrial process, or heat pump. Immersion’s complete heat capture and potential for warmer operation can improve the quality of recovered heat. Direct-to-chip can also support reuse when the cold-plate and facility-water temperatures are high enough and the server manufacturer permits them.
Do not value heat reuse from a nameplate temperature alone. Model the annual heat demand, distance and insulation of the distribution loop, heat-pump lift, seasonal mismatch, redundancy, and the temperature required by the receiving process. The facility still needs a rejection path when the heat user is unavailable.
Hardware qualification, warranty, and supply chain
AI servers are not interchangeable between cooling methods. A cold plate must match the package, mounting force, thermal interface material, board layout, and approved coolant. An immersion tank must be qualified for board coatings, cable jackets, adhesives, optical components, drives, batteries, and service connectors. Some systems may require specific firmware or fan-control settings.
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- Which exact server, GPU, accelerator, memory, and networking configurations are approved?
- What coolant or dielectric fluid, filtration level, materials compatibility, and replacement interval are specified?
- Which parts retain their full warranty after liquid installation, tank immersion, or fluid changes?
- What are the minimum and maximum supply temperatures, flow rates, pressure, and allowable transient conditions?
- Who supplies replacement cold plates, tanks, pumps, sensors, filters, and lifting equipment?
- What service tools, technician certifications, spare-parts inventory, and response times are required?
A practical selection framework
Choose direct-to-chip when these conditions dominate
- You are adding AI racks to an existing air-cooled or hybrid facility.
- The deployment will be phased and must preserve conventional rack access.
- The server supplier already offers qualified cold-plate assemblies and CDUs.
- Rack power is high but still manageable with some residual air cooling.
- You need to support multiple server generations or vendors in the same hall.
- Structural work, tanks, or fluid-service areas would delay the project.
Choose single-phase immersion when these conditions dominate
- The hall is purpose-built for dense AI loads and can support tank weight and lifting paths.
- Maximum heat capture and minimum fan or room-air infrastructure matter more than standard rack service.
- You can standardize server configurations and train a specialized operations team.
- Warm-water operation and heat reuse have a credible year-round business case.
- The project can fund fluid storage, filtration, spill control, and long-term tank maintenance.
Use two-phase immersion only after additional validation
Two-phase is worth evaluating for unusually high heat flux or a design that benefits from phase-change transfer, but insist on a full safety and environmental review. Confirm fluid availability for the expected service life, vapor management, worker exposure controls, fire and building-code requirements, and written hardware support.
How to run a defensible pilot
- Define the boundary: Record IT load, climate, facility-water temperatures, heat-rejection equipment, room-air loads, and the exact PUE and WUE boundaries.
- Instrument the system: Measure electrical input to servers, pumps, CDUs, tanks, fans, chillers, and dry coolers. Log coolant temperatures, flow, pressure, and alarms.
- Use representative workloads: Run the intended AI training, inference, storage, and networking patterns at the target rack power rather than relying on a short synthetic peak.
- Test failure scenarios: Simulate loss of a pump, CDU, facility-water source, fan group, sensor, and network connection to confirm alarms and safe shutdown.
- Exercise maintenance: Replace a server, filter, connector, sensor, and pump under normal procedures. Record time, tools, fluid handling, and required staffing.
- Review total cost: Include construction, structural work, tanks or CDUs, piping, pumps, heat rejection, electricity, water, fluid replacement, spares, training, and decommissioning.
Questions that expose weak proposals
- Is the quoted PUE measured at the whole-facility boundary or only across the liquid subsystem?
- Does the WUE number include cooling-tower makeup and blowdown?
- What percentage of the stated rack heat remains an air load in the direct-to-chip design?
- What happens to rack temperature during a pump trip, clogged filter, or loss of facility water?
- How many technicians are needed to remove a tank-mounted server, and where is the server staged during service?
- What floor loading, overhead clearance, drainage, spill containment, and fire-protection changes are required?
- Which components and software configurations are covered by warranty after the cooling conversion?
- What is the expected fluid, filter, pump, and heat-exchanger replacement schedule?
- Can the system operate efficiently at partial load, during winter free cooling, and when the heat-reuse customer is offline?
What current AI platforms imply
Tetra Tech’s April 2024 paper states: “These racks only come as liquid-cooled platforms, as traditional air-cooled racks can no longer transfer the heat at such dense loads.” The statement refers to NVIDIA GB200 NVL72-class systems. It is a useful example of the direction of high-density AI hardware, not a rule that every AI server requires liquid cooling. Server generation, accelerator count, rack power, and manufacturer qualification still determine the appropriate architecture.
As rack power rises toward and beyond the 100-kW range considered by hyperscale operators, the practical question shifts from whether to use liquid at all to which liquid architecture fits the facility. Direct-to-chip is expected to see broader adoption because it balances thermal performance with compatibility and deployment flexibility. Immersion remains compelling where complete heat capture and a purpose-built operating model justify the redesign.
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