LG Electronics secures a 5-gigawatt AI data center cooling contract in North America.
South Korea's LG Electronics has secured a long-term supply agreement with North American infrastructure platform AIR Control Concept (AIR) to provide cooling solutions for AI data centers totaling 5 gigawatts (GW) of capacity. The contract, signed through LG's U.S. subsidiary, represents the largest single cooling-solution contract in the company's history. While contract value was not disclosed, industry estimates place it between ₩2.5 trillion and ₩5 trillion (approximately $1.9 billion to $3.7 billion).
Under the agreement announced on October 5th, LG Electronics will sequentially supply high-efficiency chillers and other cooling solutions over several years to data centers being developed by AIR. A 5GW capacity is equivalent to cooling the heat generated by 50 individual AI data centers of 100 megawatts each—roughly the output of three to five nuclear reactors. According to market research firm Omdia, this contract represents approximately 5% of the global data center power capacity increase projected for next year, as the sector grows from 226GW currently to 334GW.
AIR oversees the full lifecycle of AI data center development in the United States and Canada, from design and construction through public procurement and aftermarket services, operating through its data center-specialized subsidiary, AMC (AIR Mission Critical). "Through this contract, we have established ourselves as a key partner for AI data center infrastructure in North America," an LG Electronics official said.
As AI data centers densely pack high-performance graphics processing units into compact spaces, power consumption and heat generation have become critical constraints—without timely heat dissipation, processing speeds degrade or servers shut down. Liquid cooling, which uses coolant to directly extract heat from chips, is rapidly expanding as a complement to traditional air-cooling methods. Chillers are the core equipment that produce the large volumes of cold water required for this process.
Beyond the chiller contract, LG Electronics and AIR are discussing expanding the scope to include coolant distribution units (CDUs), the key components that circulate coolant to manage server heat. Such an expansion would simultaneously grow both LG's product portfolio and business scale. LG Electronics remains one of the few companies offering a "Chip to Chiller" total solution—encompassing chillers, CDUs, and cold plates that directly absorb chip heat. The company's competitiveness rests on heat exchange technology accumulated over approximately 60 years in the heating, ventilation, and air conditioning (HVAC) business.
LG's credentials in the AI ecosystem continue to strengthen. Its 600kW and 1MW-class CDUs have met NVIDIA's specification requirements, while its 2.5MW-class CDU has received AI factory specification approval, qualifying as a "DSX-Ready CDU." Last month, the company joined the NVIDIA Partner Network.
To meet surging demand, LG Electronics is expanding production capacity. The company is building a new chiller plant in Windsor, Virginia, covering 32,000 square meters and targeting production in the first half of next year—the company's first dedicated chiller production base in the United States, where major tech companies concentrate. LG is simultaneously expanding chiller production lines in Pyeongtaek and Changwon, South Korea.
LG Electronics' AI data center cooling solution orders surpassed ₩600 billion (approximately $446.8 million) in the first half of this year alone, with shipments to small and mid-sized U.S. data centers and a signed contract for cooling solutions to an AI data center in Saudi Arabia's Neom City. Cumulative orders are expected to reach several trillion won by year-end, positioning the company to reach its ₩1 trillion chiller revenue target ahead of the original 2027 deadline set in 2024.
The market fundamentals support aggressive expansion. According to Fortune Business Insights, the global AI data center market is projected to grow at a compound annual rate of approximately 26%, reaching roughly $133.5 billion by 2034. The data center cooling market alone is expected to expand from $21 billion this year to $54.4 billion by 2034.
"LG Electronics' high-efficiency chiller technology enables us to provide proven solutions in building our AI data center portfolio," said Brad Hobbs, CEO of AIR.
Lee Jae-sung, president of LG Electronics' ES Business Division, added: "Building on our differentiated technology and rapidly expanding experience in supplying large-scale data centers, we will lead the global AI data center cooling market."
LG's push into cooling reflects a broader B2B expansion strategy. As television and home appliance markets slow and competition from Chinese manufacturers intensifies, the company is cultivating HVAC and other enterprise-focused businesses as new growth engines. B2B revenue, including HVAC, now exceeds 35% of total revenue; LG Electronics aims to raise that share to 40% by 2030.