U.S. Chiller Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2025 - 2032)

U.S. Chiller Market Size

U.S. Chiller Market Trends and Growth Drivers

Adoption of IoT and Smart Technologies Is Key Market Trend

The integration of IoT and smart technologies in chillers is enhancing their efficiency, offering energy and cost savings for customers. IoT-based chillers are capable of real-time self-monitoring, which helps in predative maintenance. IoT helps monitor critical parameters, including airflow, temperature, and energy consumption, the data on which is shared and analyzed with the help of cloud-based software or an onsite control system.

Additionally, the user experience enhances with the integration of smart controls, which allow users to remotely control the chiller using smartphones and web portals. Furthermore, these smart controls and features offer users equipment insights, such as maintenance schedules, which helps enhance the performance of these appliances.

Smart technologies also offer remote troubleshooting options, which reduce downtime and improve the overall operational reliability. Many companies are integrating these technologies into their chiller systems for gaining dominance in the market. For instance, Johnson Controls’ YORK smart connected chillers are integrated with IoT.

Infrastructure Development and Urbanization Drive Growth of Market

Infrastructure development and urbanization lead to a surge in the demand for efficient cooling systems in commercial and residential spaces. Urbanization also creates a demand for centralized cooling systems, which are rather common in the major metropolises, such as New York City, Los Angeles, San Francisco, Detroit, Miami, and Chicago.

Additionally, district cooling systems use a central plant to produce chilled water. With the establishment of district cooling system, the demand for high-capacity chillers is surging. Furthermore, the government initiatives for smart buildings and green building certifications propel the adoption of advanced chiller systems with low carbon emissions. Another reason for the market growth is the rapid replacement and overhaul of existing and outdated cooling systems, especially in large installations.

Moreover, the increase in the number of data centers in the U.S. raises the demand for advanced cooling systems. As per estimates, at the end of 2023, colocation data centers alone accounted for a total capacity of 12 MW in the country. In December 2023, the National Renewable Energy Laboratory (NREL) joined a USD 40-million program initiated by the U.S. Department of Energy’s Advanced Research Projects Agency-Energy (ARPA-E) Cooling Operations to enhance cooling system efficiency in data centers.

Stringent Environmental Regulations Are Key Challenges in Market Growth

With the rise in the focus on sustainability, energy efficiency, and refringent emissions, stringent environmental regulations are being implemented on HVAC systems in the U.S., which challenges the market growth. The U.S. Environmental Protection Agency’s (EPA)’s Significant New Alternatives Policy (SNAP) restricts the use of high-GWP refrigerants, such as R-134a and R-410A. Furthermore, the Kigali Amendment to the Montreal Protocol affects the market growth by mandating the gradual phaseout of hydrofluorocarbons (HFCs), which are a popular refrigerant in the U.S.

U.S. Chiller Market Analysis

Type Insights

• The water-cooled bifurcation holds the larger market share, of around 60%, in 2024.
• This is due to the greater efficiency of water-cooled chillers than their air-cooled counterparts, as water possesses superior thermal conductivity, which makes it a reliable solution for large facilities.
• These chillers also boast a higher cooling capacity, which makes them an ideal option in industrial settings, data centers, and large commercial buildings.
• The air-cooled bifurcation will grow at the higher CAGR during the forecast period.
• Air-cooled chillers offer easy installation, which makes them popular among smaller businesses and commercial setups looking for lower initial investments.
• These variants are ideal for retrofitting projects, the number of which is increasing at a rapid pace in the country.

The types analyzed in this report are:

• Air-Cooled (Faster-Growing Category)
• Water-Cooled (Larger Category)

Compressor Type Insights

• The screw category holds the largest market share, of around 35%, in 2024 as these chillers come in both air-cooled and water-cooled chillers.
• Additionally, chillers with screw compressors are widely used in mid-size and large buildings, such as office towers, manufacturing plants, and hospitals.
• These chillers offer the advantage of lower maintenance and operational costs.
• The absorption category will grow at the highest CAGR during the forecast period.
• Absorption chillers are now integrated with advanced technologies to meet environmental regulations and sustainability goals, by reducing carbon emissions.
• The growing adoption of the district cooling technology raises the demand for absorption chiller systems in the country.
• Absorption chillers can use various heat sources, such as natural gas, steam, hot water, and renewable sources, which enables their usage in a wide range of applications.

The compressor types analyzed in the report are:

• Scroll
• Screw (Largest Category)
• Centrifugal
• Reciprocating
• Absorption (Fastest-Growing Category)

Power Rating Insights

• The 101–500 kW category holds the largest market share. Chillers with this much power output are suitable for commercial buildings, hospitals, small-scale industrial plants, and educational institutions.
• The growth of the pharmaceutical and food & beverage industries is boosting the demand for these chillers as they provide a balance of capacity, energy efficiency, and cost-effectiveness.
• The <50 kW category will grow at the highest CAGR during the forecast period.
• The rising level of urbanization in the country increases the number of residential and other kinds of smaller buildings, which require low-capacity and energy-efficient chillers.
• These alternatives are best for the retail sector and small commercial establishments, such as cafes and offices.

Based on power rating, the market has the following categories:

• <50 kW (Fastest-Growing Category)
• 51–100 kW
• 101–500 kW (Largest Category)
• 501–1,000 kW
• 1,001–1,500 kW
• >1,501 kW

Application Insights

• The commercial category is the largest, with a market share of around 60%, in 2024.
• This is due to the extensive adoption of chillers in commercial buildings, such as offices, hospitals, hotels, retail spaces, and supermarkets.
• The rapid urbanization and expansion of the hospitality sector drive the need for chillers to maintain the indoor temperature and offer visitors and guests optimum comfort.
• The industrial sector will grow at the highest CAGR during the forecast period.
• This is attributed to the rising manufacturing activities, specifically chemical manufacturing, food & beverage processing, and pharmaceutical production, where precise temperature control is vital.

Based on application, the market has the following categories:

• Commercial (Largest Category)
• Corporate Offices
• Data Centers
• Public Buildings
• Mercantile & Service
• Healthcare
• Others
• Industrial (Fastest-Growing Category)
• Chemicals & Pharmaceuticals
• Food & Beverage
• Metal Manufacturing & Machining
• Medical & Pharmaceutical
• Plastics
• Others
• Residential

Regional Analysis

• The southern region holds the largest market share, of around 35%, in 2024, and it is also expected to grow at the highest CAGR in the coming years.
• This can be attributed to the growth in construction activities and the expansion of industries in the southern states.
• The semiconductor industry in Texas is witnessing rapid growth with the rising investment by companies such as Samsung SDI and Texas Instruments.
• This is driving the demand for advanced chiller solutions to manage the heat generated during the production of semiconductors and ensure product quality and process efficiency.
• Additionally, the southern region is the warmest in the country, which makes cooling equipment important.

The regions analyzed in this report are:

• Northeast
• Midwest
• West
• South (Largest and Fastest-Growing Region)

U.S. Chiller Market Share

The market for chillers in the U.S. is fragmented due to the large number of players, both local and international. Market players are focusing on partnerships and collaborations as the key strategies to enhance their portfolios and expand their market presence.

U.S. Chiller Market News

• In November 2024, Carrier Global Corporation partnered with Thermal Labs to offer products and services for data centers, including heating and cooling solutions.
• In May 2024, LG Electronics Inc. launched chillers with a capacity of up to 50,000 refrigeration tons for large data centers in the U.S.
• In May 2024, Johnson Controls Saudi Arabia announced plans to export 300 scroll chillers to the U.S. The USD 26.66-million order will be shipped from the Johnson Controls Arabia manufacturing complex in King Abdullah Economic City.