This is an excerpt from an article featured in ATMOsphere’s “Clean Cooling for Data Centers 2025” report, which can be downloaded here. ATMOsphere is the publisher of NaturalRefrigerants.com. You can read part 1 of this story here.
In addition to the industry’s general growth, its acceptance of higher water temperatures and simultaneous concerns around excessive water use have stoked demand for Jaeggi’s hybrid dry cooler. Jeffrey Hargreaves, Business Development Director for Data Centers at Jaeggi, has been in the data center industry for more than a decade, and, since he started, acceptable water temperatures for cooling have climbed from 17°C (62°F) to as high as 28°C (82°F).
“That’s made our products more relevant because we can get close to cooling tower temperatures,” Hargreaves said. “Not quite as close, but now it doesn’t matter because we don’t need to be as close. The trends have moved the industry a lot more in our favor.”
One trend that’s working against Jaeggi is the push for data centers to use no water at all, which Hargreaves said is coming from the United States. Air-cooled chillers with free cooling offer a way to take water out of the cooling process. However, water is a more efficient heat transfer medium than air, and Hargreaves noted that the term “free cooling” is a misnomer because power is still required by the chillers.
“There’s nothing free about them because they’re using a ton of electricity,” Hargreaves said. “When a chiller is using a ton of electricity, the power generation is using a ton of water. In comparison, for the same amount of water we use, back at the electricity generation there can be at least 20 times more water to create the electricity needed to do the same cooling.”
Regarding future growth, Hargreaves said Australia is a particularly promising market. The Nordic countries are also being eyed because of the cool climate and potential to use the HTK without a chiller. He added that Eastern Europe, particularly Romania, will be a “big market.” Jaeggi currently has more than 15 “major” data center projects. Of those, five are in the fast-growing Australian market.
“There’s probably more projects in Australia than anywhere in the world I know of at the moment.”
Jeffrey Hargreaves,
Business Development Director for Data Centers at Jaeggi
Opportunity in Australia
In June 2025, Amazon announced plans to invest AU$20 billion (US$13 billion/€11.2 billion) in Australia from 2025–2029 to “expand, operate and maintain its data center infrastructure” and “strengthen Australia’s cloud and AI capabilities.” In October 2023, Microsoft said it would invest AU$5 billion (US$3.2 billion/€2.8 billion) to expand its hyperscale cloud computing and AI infrastructure in Australia, with its total number of data centers growing from 20 to 29.
Bloomberg reported in April 2025 that Microsoft was pulling back from data center developments worldwide, including in Australia, although the tech company later told the Australian Financial Review its plan remains on track. Despite Microsoft possibly pumping the brakes, the overall outlook for the Australian data center market is bullish, with installed IT power capacity forecast to increase from 1.3 to 1.8GW from 2025 to 2028, with demand expected to grow to between 2.5 to 3.5GW over the same period.
While hyperscalers like Amazon and Microsoft have made the news for their investments in Australia, when it comes to data centers of this size, they aren’t the only ones operating in the space. That said, many of the companies opening data centers that rival the size of those operated by hyperscalers are doing so specifically with these companies in mind.
“People think there are hyperscalers – like Amazon, Google and Microsoft – and everything else is colocation,” Hargreaves said. “That’s true and not true. There are a lot of big companies, like Equinix, NTT and Vantage, that are developing big data centers based on supplying them to these hyperscalers. In reality, Equinix, NTT and Vantage are all hyperscaler builders.”
Hargreaves said the majority of the growth is concentrated on Australia’s east coast, particularly in and around Sydney and Melbourne. He added that most of the projects Jaeggi is working on are for “very big” data centers, with installed IT power capacities of 180MW and up. Jaeggi is currently working on a few AI projects around the 50MW range and has customers looking to put up six or seven AI data centers across Australia.
“They’re looking at higher temperatures, which means mostly we can run without water, and only for a very small amount of time per year will we have to use water,” Hargreaves noted.
In addition to Australia, the APAC region is also seeing a data center boom in Malaysia. The city of Johor Bahru, which is connected to Singapore by bridge, is attracting considerable attention. The Philippines and Indonesia are also seeing growing data center development. Still, in the APAC region, the action is primarily in Australia.
“There’s probably more projects in Australia than anywhere in the world I know of at the moment,” Hargreaves said.
