By Eamonn Ryan

Chillers are engineering masterpieces, not just plug-and-play.

VRF systems are modular, incorporate sophisticated controls, easily integrate building management systems and offer easier individual billing. Image supplied by © Benjamin Brits | RACA Journal

VRF systems are modular, incorporate sophisticated controls, easily integrate building management systems and offer easier individual billing. Image supplied by © Benjamin Brits | RACA Journal

Chillers require serious engineering skill and in their own way, can be works of art that engineers love to install and take pride in, as opposed to plug-and-play VRF (Variable Refrigerant Flow) HVAC systems. The traditional chiller is a large-scale cooling system that uses chilled water to cool the air in a building. While VRF systems have taken a lot of market share from traditional chillers since 2000 due to their energy efficiency and flexibility, there will always be a market for chillers. They are typically used in large commercial buildings such as hospitals, universities and office buildings. Chillers are still the preferred choice in large-scale applications, being known for their high cooling capacity and energy efficiency. Additionally, chillers have a longer lifespan than VRF systems and require less maintenance.

In terms of air-conditioning projects, chilled water plants are a marvel to behold, with impressive control panels and infrastructure. Engineers take pride in designing and implementing chilled water systems, as it is a reflection of their expertise. On the other hand, VRF systems may not be as visually impressive, but they are functional. There will always be debates and preferences between the two technologies, and both have their merits. LG, in a discussion on its White Paper titled Chiller vs VRF, the company says: “When it comes to chillers, because the capacity that can be covered by a single unit is larger than a VRF, chillers are more advantageous for larger facilities. Additionally, chillers are better for high-rise buildings because there is less of a restriction on the length of piping than there is with VRF systems.”

Pricing in this market is determined by various factors, such as equipment quality, service backup and longevity. However, it also depends on the technology and models each manufacturer selects to remain competitive in the market. Ultimately, customers make their purchasing decisions based on the relationships they have built and the value they perceive in the product and service backup.

Chillers are more efficient at high-capacity loads such as what is required at a hospital with 24-hour operation. Image supplied by RACA Journal

Chillers are more efficient at high-capacity loads such as what is required at a hospital with 24-hour operation. Image supplied by RACA Journal


The following is an extract from a report by Technavia, Industrial Chillers Market Growth by End-user, Type and Geography – Forecast and Analysis 2023-2027 published in March 2023. 

The report estimates that the industrial chillers market will grow at a compound annual growth rate (CAGR) of 4.35% between 2022 and 2027, while the size of the markets forecast to increase by R23-billion. The report lists several factors on which this growth will depend, such as the growing adoption of district heating and cooling infrastructure in mostly developed economies, stringent regulations on refrigerant use and the growing use of industrial chillers across various industries. The report covers market segmentation by end-user (chemical and petrochemical, plastics, food and beverage, pharmaceuticals and biotechnology, and others), type (water chillers and air chillers) and geography (APAC, North America, Europe, Middle East and Africa and South America). It also includes an in-depth analysis of drivers, trends and challenges.

Those drivers include the growing adoption of district heating and cooling infrastructure as the key factor driving the industrial chillers market growth. A district cooling system is an economical option when compared to running compressors for refrigeration – which require more energy. The system requires a central refrigeration plant, pumping stations and a piping network. District cooling replaces traditional air cooling because it offers many advantages, such as energy savings, less environmental impact and less maintenance requirements. Industrial chillers are often used in district cooling systems that can process and cool large volumes of water. Operating these large systems can result in significant power savings.

District cooling systems have been adopted in many developed countries such as European countries, North America and Japan, to reduce power consumption and lower the environmental impact of large cities and in high-density industries. In addition, some Middle Eastern countries – such as the UAE, Qatar and Kuwait – have adopted this technology to cope with hot climatic conditions. However, in developing countries, the concept of district cooling is relatively new as these systems are mostly used in industrial parks. The development of smart cities and the increasing urban population could lead to more adoption of these systems.


Another factor fuelling the industrial chillers market’s growth is the advent of smart chillers connected with sensors. This trend is derived from the requirement to improve reliability and performance, minimise equipment downtime and contain lifecycle maintenance costs for chillers used in HVAC&R applications. Some of the key features of smart connected chillers are critical alarm systems, cloud data storage, and remote monitoring and diagnostics functionality. The advent of intelligently connected chillers is revolutionising the way chillers are serviced and maintained.

Smart chillers stream data directly from the device to the cloud for use by technicians for the purpose of advanced analytics and remote monitoring. It enables machine operators to predict when a chiller will fail or operate at below peak capacity, and thereby perform early or predictive maintenance. The result is fewer operational disruptions, less downtime and longer equipment life.


Industry is focusing on improving the energy efficiency of their facilities, reducing energy costs and reducing emissions, which in turn is expected to drive growth of the global industrial chillers market. However, high acquisition and maintenance costs are major challenges that may threaten those expectations during the forecast period. Most energy efficient HVAC&R technologies, including industrial chillers, are considerably more expensive than their traditional counterparts, significantly lengthening the break-even point of equipment.

This impact will be most visible for budget-conscious customers, especially in emerging markets such as South Africa, India and China, where business is price sensitive. South Africa is notoriously more concerned about initial acquisition costs. Furthermore, annual maintenance costs for industrial chillers are 20% to 35% higher than traditional chillers and can add up to a significant amount over the years. Therefore, the relatively high cost of industrial chillers is one of the main reasons expected to affect the market growth during the forecast period.


In some sites, there is no argument that a chiller is the only answer. In data centres, for instance, with their enormous need for uninterruptible cooling and 100% redundancy, Levi Bands, applied sales director at Trane Service First says that chillers are without doubt the best option. “Due to the impact of cooling system failures on their revenue, some businesses, such as casinos, data centers and shopping malls, prioritise redundancy and have 100% backup systems in place. They understand that downtime can result in significant financial losses, so they invest in additional chillers or cooling equipment to ensure uninterrupted operation.”

Starting in the early to mid-2000s, manufacturers and factories have focused on updating their technology to address environmental issues such as global warming, energy usage and limited resources. Trane has made several key technological innovations in recent years, particularly in the area of HVAC equipment, specifically chillers. Bands explains that one of the significant developments is that chiller manufacturers are placing a significant emphasis on improving the energy efficiency of their products. This included developing new technologies for heat recovery, heat pump technology, polyvalent (four pipe) chiller technology, variable-speed compressors, magnetic bearing technology and advanced controls to optimise chiller performance under varying load conditions. “Additionally, there was a strong push toward using more environmentally friendly refrigerants with lower global warming potential (GWP) for reduced environmental impact.” At the same time, he notes, the integration of Internet of Things (IoT) into chillers has been a growing trend.

“Manufacturers are working on creating smart and connected chillers that could be remotely monitored and controlled. These systems allow for real-time performance analysis, predictive maintenance and the ability to make adjustments for optimal efficiency.” Manufacturers have taken a growing focus on lifecycle cost and Total Cost of Ownership (TCO). “This has shifted the focus from upfront costs to the overall TCO of chiller systems.

Manufacturers have been working on providing tools and information to customers to help them make more informed decisions that consider long-term operational expenses, maintenance costs and energy savings. The capital cost of a chiller can range from about 20% to 40% of the total lifecycle cost, depending on the size and complexity of the system. The operational cost – particularly energy consumption – is consequently the major ongoing expense and can account for approximately 60% to 80% of the total lifecycle cost over the chiller’s operational life,” says Bands. However, he notes that there is still a section of the market that prioritises low upfront costs over long-term performance and maintenance.

Trane is at the forefront of these technological advancements and has dedicated itself to reducing carbon emissions from its products. It has been actively promoting and implementing these new generation chillers in their product lineup in recent years. “The industry is moving towards the use of refrigerants with lower GWP. In Europe, there is legislation in place to phase out HFC refrigerants in favour of HFO refrigerants. In addition, in countries like South Africa where such legislation is not yet as aggressive as Europe, some environmentally conscious organisations nonetheless choose to adopt more environmentally friendly options voluntarily.”

Regarding chiller types, there are two main options: water-cooled chillers and air-cooled chillers. Water-cooled chillers employ cooling towers to reject heat by circulating water and using evaporation and a fan for cooling. On the other hand, air-cooled chillers rely on condenser coils, similar to car radiators, to exchange heat with the ambient air. In terms of pros and cons, water-cooled chillers are generally more energy efficient due to the superior heat transfer properties of water. However, they require additional equipment and maintenance, which can result in higher operational costs. They also consume more water, which may be a concern in certain environmental contexts.

“On the other hand, air-cooled chillers have a simpler design and lower maintenance requirements. They do not rely on water resources and are generally easier to install. However, their efficiency may be lower, especially in warmer climates where ambient air temperatures are high. In recent years, there has been a trend towards designing systems with air-cooled chillers instead of water-cooled chillers, particularly in Johannesburg. This shift is driven by considerations of environmental impact, maintenance costs and energy efficiency. Air-cooled chillers can be more efficient in low ambient temperatures and require less water consumption over a 20-year span.”


Chillers vs VRF: VRF systems require small plantroom spaces and can easily by hidden behind facades, within service levels or on small platforms. Image supplied by RACA Journal

Chillers vs VRF: VRF systems require small plantroom spaces and can easily by hidden behind facades, within service levels or on small platforms. Image supplied by RACA Journal

The choice between a chiller and VRF system depends on the specific requirements of the project. For smaller buildings, like two- or three-story structures of individual offices and retail centres, a VRF or individual units may be more cost-effective.

Chilled water systems, on the other hand, are better suited for larger commercial and industrial applications, such as manufacturing facilities and hospitals, where a higher capacity for cooling is required. In addition, for larger buildings with diverse cooling loads and requirements, such as ones with double or triple volume spaces – like a big reception area or conference facility – then a chiller is more accurate and efficient in meeting specific cooling requirements. Despite being more expensive to install, chilled water, running steel pipes and pumping water around the building is easier, compared to running copper pipes and pumping refrigerant. Furthermore, for hospitals, hotels or larger office complexes, running water becomes more feasible as it is easier to repair and handle a water leak compared to a refrigerant leak.

“One key difference between VRF and chilled water systems lies in their primary purpose. VRF systems are primarily focused on providing comfort cooling and heating for people in an environment,” adds Bands. Chilled water systems can be used for a wide range of applications beyond comfort cooling, including industrial processes and data centers.

Some chillers can use free cooling with seasonal conditions – such as during winter times when ambient temperatures are normally lower.Image supplied by AHI Carrier

Some chillers can use free cooling with seasonal conditions – such as during winter times when ambient temperatures are normally lower. Image supplied by AHI Carrier


Levi Bands, applied sales director at Trane Service First. Image supplied by Trane Service First.

Levi Bands, applied sales director at Trane Service First. Image supplied by Trane Service First.

“It is common for people to view maintenance as a grudge purchase and neglect it. However, it is essential to maintain mechanical equipment like chillers to ensure their efficiency and longevity. Neglecting maintenance can lead to decreased efficiency, breakdowns and higher repair costs in the long run. Preventative maintenance is more cost-effective and ensures consistent service delivery. “It is important to understand that not everyone has the knowledge or expertise in HVAC systems and may not fully grasp the importance of maintenance. As professionals in the field, it is our responsibility to educate customers and explain the significance of regular servicing. Collaboration and understanding among customers are key in conveying the value of maintenance and its purpose in ensuring optimal performance and efficiency in their chiller systems.

“We often encounter discussions and debates with clients about the value of preventative maintenance versus reactive maintenance. Some clients understand the importance of maintenance and prioritise it, while others may not fully grasp the concept. We need to educate customers about the complexities and processes.