Liquid Cooling for Data Centres in Australia: When You Need It and When You Do Not
Data Centre Cooling · High Density · Australia
Liquid cooling uses water or a dielectric fluid instead of air to carry heat away from servers, and it becomes necessary in Australian data centres at roughly 35 kilowatts per rack, the point where air cooling stops being physically able to move enough heat. Water carries around 3,500 times more heat per unit of volume than air, which is why a coolant loop can do what no amount of fan capacity can. Indigi Power and Cooling assesses, installs and maintains precision and high density cooling across Australia, and is an Indigenous and Veteran-owned business registered with Supply Nation and ICN Gateway.
Liquid cooling has gone from a specialist curiosity to the most discussed topic in data centre infrastructure in about three years, driven almost entirely by AI training hardware. A rack of GPU servers can draw more power than an entire small business server room, and the physics of air simply run out at that density. Australian operators including NEXTDC and Macquarie Data Centres now advertise liquid ready halls, and vendors such as Vertiv and Schneider Electric market complete liquid cooling ranges into the region.
What is much harder to find is a straight answer to the practical question. Most Australian server rooms and enterprise data centres run somewhere between 3 and 12 kilowatts per rack, and at that density liquid cooling would be an expensive answer to a problem the site does not have. This guide sets out what liquid cooling actually is, the four forms it takes, the density thresholds that trigger each one, the downsides that vendor material tends to skip, and what a site should do now if high density workloads are on the horizon.
What is liquid cooling in a data centre?
Liquid cooling is any approach that brings a fluid to the heat source rather than relying on moving air across it. The fluid absorbs heat directly from a processor, a cold plate or the surface of the server itself, then carries it to a heat exchanger where it is transferred to a facility water loop and eventually rejected outside.
The reason it works so much better is volumetric heat capacity. A cubic metre of water can absorb roughly 3,500 times as much heat as a cubic metre of air for the same temperature rise. Cooling a 100 kilowatt rack with air would require moving air at a rate that is loud, energy hungry and physically awkward to duct. Doing it with water requires a pipe you could hold in one hand.
The component that ties a liquid cooled deployment together is the coolant distribution unit, or CDU. It separates the clean technology cooling loop that touches the IT equipment from the facility water loop that runs through the building, controls flow and pressure, and holds the coolant above dew point so condensation never forms on cold plates. Every serious liquid deployment has one, and its reliability is central to the design.
The four types of data centre liquid cooling
The four approaches differ enormously in how invasive they are, which matters far more than raw capacity when deciding what an existing site can adopt.
| Type | How it works | Density | Retrofit into an existing hall |
|---|---|---|---|
| Rear door heat exchanger | A liquid cooled coil replaces the rack's rear door and cools exhaust air before it re-enters the room | 30 to 60 kW per rack | Easiest. Servers are unmodified, so this is the usual first step |
| Direct-to-chip, single phase | Cold plates sit on the CPU and GPU with coolant pumped through them; remaining heat is still air cooled | 60 to 150 kW per rack | Moderate. Needs liquid ready servers, manifolds, a CDU and leak detection |
| Single phase immersion | Whole servers are submerged in a dielectric fluid in a horizontal tank | 100 kW per tank and above | Hard. Different floor layout, floor loading and handling procedures |
| Two phase immersion | Fluid boils on hot components and condenses on a coil above, moving heat by phase change | Highest available | Hardest. Sealed tanks, costly fluids and evolving regulatory treatment |
One point that gets lost in the marketing: direct-to-chip cooling does not remove all the heat. Cold plates typically capture 70 to 80 percent of the rack's heat, and the remainder still leaves as warm air from memory, drives, power supplies and network cards. That residual air load still needs CRAC or CRAH capacity, so a liquid cooled hall is a hybrid hall, not an air free one. Only full immersion eliminates the air side.
When do you actually need liquid cooling?
Density decides. The thresholds below reflect where each technology stops being practical rather than where a datasheet claims a maximum.
| Rack density | Right answer | Typical workload |
|---|---|---|
| Up to 15 kW | Room based air cooling with proper containment | The overwhelming majority of Australian enterprise and government rooms |
| 15 to 35 kW | In-row or close-coupled air cooling | Dense virtualisation, storage arrays, small HPC clusters |
| 35 to 60 kW | Rear door heat exchangers | A few GPU racks added to an existing air cooled hall |
| 60 to 150 kW | Direct-to-chip liquid cooling with a CDU | AI training and inference clusters |
| Above 150 kW | Immersion cooling | Purpose built AI and HPC facilities |
If your racks sit under 15 kW, the highest return on cooling spend is almost never liquid. It is containment, blanking panels, correct set points and a maintenance regime that keeps coils clean and refrigerant charge correct. Those measures typically recover 20 to 30 percent of existing capacity for a fraction of the cost. Our guide to data centre cooling systems covers the air side options in full.
Liquid cooling vs air cooling
Where liquid cooling is genuinely warranted, the efficiency gains are real. Vertiv's published modelling of a fully optimised deployment reports a 10.2 percent reduction in total data centre power and better than a 15 percent improvement in total usage effectiveness. Liquid systems also allow much warmer supply water, which expands the hours a site can run on free cooling instead of compressors.
| Factor | Air cooling | Liquid cooling |
|---|---|---|
| Practical density | Up to about 35 kW per rack with close-coupled units | 150 kW per rack and beyond |
| Capital cost | Lower, and every contractor can install it | Higher, with CDUs, manifolds, piping and leak detection |
| Energy efficiency at high density | Poor, since fan power rises steeply with density | Strong, with far less fan energy and warmer supply water |
| Retrofit into an existing site | Straightforward | Depends entirely on whether a facility water loop already exists |
| Maintenance skills | Standard refrigeration and HVAC trades | Hydronics, fluid chemistry, coolant quality testing |
| Failure mode | Gradual temperature rise, minutes to react | Faster thermal excursion, plus leak risk near live equipment |
The downsides vendors tend not to lead with
Liquid near live electronics. The risk is managed rather than eliminated. Dry break quick disconnect couplings, negative pressure loops, leak detection cable in the trays and under the floor, and correct commissioning are all part of a competent design. None of them are optional, and all of them add cost.
Thermal inertia disappears. An air cooled hall holds a reservoir of cool air that buys operators several minutes when cooling stops. A densely liquid cooled rack has almost no such buffer, and pump or CDU failure can take equipment past its thermal limits in well under a minute. That shifts redundancy requirements onto the pumps, the CDU and their power supply, which in turn means the cooling system needs UPS backing rather than just generator backing.
Hybrid operation is the norm. Because cold plates leave 20 to 30 percent of the heat in the air stream, most sites end up operating two cooling systems at once, with two sets of controls, two maintenance regimes and two failure modes to understand.
Standards are still settling. Coupling types, coolant specifications and service procedures vary between vendors, which creates practical lock-in. Two phase immersion fluids in particular face evolving environmental and regulatory scrutiny internationally, which is a genuine consideration for a system with a fifteen year life.
Trade coverage in Australia is thin. Outside the major metropolitan colocation providers, the pool of technicians who can commission and service a liquid loop correctly is small. For a regional or remote site, service response time should be part of the technology decision, not an afterthought.
What Australian sites should do now
Very few Australian enterprise sites need liquid cooling today. Many will need to accommodate one or two high density racks within a few years, and the cheapest time to prepare is before that rack is ordered.
Start by measuring actual rack loads at the PDU rather than trusting a design assumption from a decade ago. Establish whether a facility water loop exists or could be run to the hall, since that single fact determines whether rear door heat exchangers or direct-to-chip are even feasible without major works. Check raised floor loading against immersion tank weights if that path is under consideration. Confirm the supply water temperature the site can deliver, because ASHRAE's liquid cooling classes run from W17 up to W45 by maximum facility supply temperature, and warmer classes are the ones that unlock free cooling hours. Finally, look at whether cooling pumps and CDUs would sit on UPS protected power, because in a liquid cooled hall they must.
Where a hall is already at its air cooling limit, a rear door heat exchanger on the two or three hottest racks is almost always the cheapest and least disruptive next step, and it buys several years of headroom without rebuilding the room.
High density cooling support across Australia
Indigi Power and Cooling assesses high density readiness and delivers the air side and hybrid cooling that sits alongside liquid deployments, nationally from Brisbane, Sydney and Melbourne.
Brisbane and QLD
Brisbane CBD, Woolloongabba, Eight Mile Plains, Port of Brisbane, Gold Coast, Sunshine Coast, Ipswich, Townsville, Cairns
High density readiness assessments and rack load surveys from HQ.
Sydney and NSW
Sydney CBD, Parramatta, North Ryde, Macquarie Park, Western Sydney, Newcastle, Wollongong, Canberra (ACT)
Hybrid hall support where GPU racks share space with air cooled equipment.
Melbourne and VIC
Melbourne CBD, Port Melbourne, Docklands, Dandenong, Tullamarine, Geelong, Ballarat, regional Victoria
Chilled water tie-ins and free cooling assessment for warmer water classes.
Perth and WA
Perth CBD, Fremantle, Kalgoorlie, Pilbara, regional WA
Service response planning for remote sites considering high density kit.
Adelaide and SA
Adelaide CBD, Port Adelaide, Salisbury, Mount Gambier, Whyalla, regional SA
Rear door heat exchanger feasibility reviews on existing halls.
Darwin and NT
Darwin CBD, Palmerston, Katherine, Alice Springs, remote NT sites
High ambient and humidity constraints on heat rejection for dense racks.
Western Australia, Tasmania and Pacific Islands: for remote sites, service coverage and spare parts logistics should be settled before a high density technology is chosen, not after. Contact us to discuss scheduling.
Frequently asked questions
What does liquid cooling do for data centres?
Liquid cooling carries heat away from processors using water or a dielectric fluid instead of air. Because a given volume of water absorbs roughly 3,500 times more heat than the same volume of air, it supports rack densities that air physically cannot handle, and it uses far less fan energy while doing so.
What liquid is used to cool data centres?
Direct-to-chip and rear door systems generally use treated water with a glycol and corrosion inhibitor package in a closed loop. Immersion systems use non conductive dielectric fluids, typically synthetic or hydrocarbon based for single phase tanks and engineered fluorinated fluids for two phase tanks. Coolant quality is monitored and periodically replaced as part of maintenance.
What are the downsides of liquid cooling?
Higher capital cost, leak risk near live equipment, very little thermal buffer if pumps or the CDU fail, a smaller pool of technicians who can service it, and vendor specific couplings and fluids that create practical lock-in. Most direct-to-chip deployments also still need air cooling for the remaining 20 to 30 percent of rack heat, so the site runs two systems.
Is liquid cooling worth it?
It is clearly worth it above roughly 35 kilowatts per rack, where air cooling cannot do the job at any price. Below about 15 kilowatts per rack it rarely pays, and the same money spent on containment, blanking panels, correct set points and maintenance usually returns more capacity. Between those figures, in-row air cooling is normally the better value option.
How many data centres use liquid cooling?
A minority today. The great majority of facilities worldwide and in Australia remain air cooled, with liquid cooling concentrated in AI, GPU and high performance computing deployments. Adoption is rising quickly at the top end of the market, and several Australian operators now offer liquid ready halls, but most enterprise and government rooms will stay air cooled for years yet.
When do you need liquid cooling instead of air cooling?
At around 35 kilowatts per rack and above. Up to 15 kilowatts, room based air cooling with containment is sufficient. From 15 to 35 kilowatts, in-row or close-coupled air cooling handles the load. Above that, rear door heat exchangers take a rack to about 60 kilowatts, direct-to-chip to around 150 kilowatts, and immersion beyond that.
Related reading and services
- Data centre cooling systems explained
- Server rack cooling: fans versus real cooling
- CHW CRAC maintenance (chilled water)
- CRAC topology selector (DX, CDW, CHW)
- Server room heat load calculator
- CRAC installation and commissioning
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Planning for high density racks? Find out what your room can take first. Tell us your current rack loads, whether a chilled water loop is available and what hardware is coming, and we will tell you where your air cooling runs out. Indigi Power and Cooling is an Indigenous and Veteran-owned critical power and cooling specialist, registered with Supply Nation and ICN Gateway. Contact Indigi Power and Cooling |
