SK Enmove in talks to deliver liquid cooling system to US tech firm

South Korea’s lube oil maker SK Enmove Co. is seeking to supply liquid immersion cooling systems for data centers of a US technology company, a move expected to help keep the Korean company at the forefront in the liquid heat management market, set to grow rapidly.  

According to sources in the refinery industry on Wednesday, SK Enmove, Korea’s top oil refiner SK Innovation Co.'s subsidiary, is in negotiations to supply its liquid immersion cooling system to data centers of an American technology firm.

US computer giant Dell Technologies Inc., which also makes graphics processing units, is floated as the first customer.  

Dell and other US Big Tech companies such as Google and Microsoft are said to have shown interest in SK Enmove’s liquid immersion cooling technology.

SK Innovation confirmed that its lube oil unit is in talks to supply its cutting-edge cooling system but said it has not yet reached an agreement and did not reveal any names.

The Korean company plans to test its liquid immersion cooling system at SK Telecom Co.'s data centers this year before supplying the system to Big Tech firms.

If SK Innovation cements the supply deal with the US customer, it would mark the first commercialization of such a liquid immersion cooling technology by a Korean company and would accelerate the Korean company’s advance into the global liquid immersion cooling market set to burgeon amid growing demand for data centers, electric vehicles and energy storage systems (ESS).

The global thermal fluid heat management system market is forecast to grow from 1 trillion won ($750 million) between 2025 and 2026 to more than 40 trillion won in 2040 at an annual average growth rate of up to 30%.

The development of AI computing, which guzzles energy, is expected to further expedite demand for liquid immersion cooling systems.

ENERGY-SAVING COOLING OPTION

Liquid immersion cooling is a heat management technology that cools data servers by directly submerging them in a cooling liquid. It is more efficient in heat management than air cooling.

Currently, about 40% of a data center’s power is used for heat management. The use of the new liquid cooling technology is expected to save data center power usage for cooling by using just one-tenth of current power consumption, meaning that a mere 4% of total data center power will be used for cooling.

The new thermal fluid heat management system uses cooling fluids made of a mix of different oils. Its performance depends on the use of a thermally conductive but not electrically conductive fluid to prevent it from disrupting the function of electrical components.

“We have successfully tested its insulation performance, compatibility and safety, and the technology is ready for commercialization,” said an SK Innovation official.

As its demand is set to grow rapidly, multinational refiners, including Shell Plc, and startups in the US and Europe are actively seeking to commercialize the technology.  

Considering the market is still in its very early development stages, it is important to make prompt investments to develop and commercialize related technologies before its rivals to lead the market.

“The liquid immersion cooling industry does not yet have global industrial standards so the sooner we commercialize a related technology and build a delivery track record, the earlier we can gain market confidence,” said an energy industry official.  

SK Enmove last summer signed a memorandum of understanding with Dell Technologies and data center cooling system provider Green Revolution Cooling Inc. (GRC) to jointly develop lubricant-based liquid coolants for data centers and build a supply chain in key growth regions around the world.

In early 2022, the Korean lube oil maker invested $25 million in GRC with technologies to evaluate and verify heat management fluids used in immersion cooling systems for data centers.

Last month, the Korean company agreed with UK-based precision liquid cooling system specialist Iceotope Technologies Ltd. on a partnership to advance their coolant technologies and expand their presence in the fast-growing liquid cooling market.

They will work together to develop customized thermal fluids for precision liquid cooling systems.

SK Enmove also plans to mass-produce liquid immersion cooling systems for ESS and EV batteries.

Write to Sang Hoon Sung at uphoon@hankyung.com


Sookyung Seo edited this article.