Nvidia says its new AI chips won't require as much AC

All of the computer equipment crammed into AI data centers produces a lot of heat. And since computers stop working when they get too hot, AI data centers have to be cooled down with water and air conditioners.

But on Tuesday, Nvidia CEO Jensen Huang poured cold water on the idea that the AI boom was also creating an HVAC boom.

Huang said his company’s next generation chips won’t need as much cooling.

Vinod Narayanan, director of the Western Cooling Efficiency Center at the University of California, Davis, said the operating temperature for chips can be as high as 70-80 degrees Celsius.

That’s about 175 degrees Fahrenheit, the temperature Narayanan said chips can’t go over.

To keep them at that cool 175 degrees or below, you need a lot of electricity.

“Typically, air-cooled data centers require about 30 to 35 percent of the electrical energy that’s coming into the data center for cooling — just for cooling, not for computation,” Narayanan said.

One way to reduce costs is to cool with water, instead of air. But in many cases, the water has to be chilled, too.

Huang dropped details at CES, an annual trade show organized by the Consumer Technology Association in Las Vegas, about how Nvidia’s latest chips operate.

“No water chillers are necessary for data centers,” Huang said. “We’re basically cooling this supercomputer with hot water. It is so incredibly efficient.”

Huang’s comments sent HVAC company shares plunging. But Timothy Wojs, senior research analyst at Baird, said HVAC companies are still going to have plenty of business in the near term.

“I think it does kind of just more explicitly draw out that the data center infrastructure is changing, and maybe those water chillers won’t have as big of a role over time in the data center than maybe they have now,” Wojs said.

Chips that require less cooling will provide tangible environmental benefits in the long term, said Shaolei Ren, a professor of electrical and computer engineering at the University of California, Riverside.

“The most immediate impact is reducing the energy, which indirectly reduces the carbon emission,” he said.

Ren said water use — in some cases — could also be reduced if chips can be cooled by ambient temperatures.

He said he expects many of the new data centers being planned out now to use less energy than the ones we’ve been used to.