Modular Chiller Market

Modular Chiller Market Outlook (2025 to 2035)

The global modular chiller market is expected to grow from USD 4,105 million in 2024 to USD 7,303 million by 2035, reflecting a CAGR of 5.4% over the forecast period (2025 to 2035). This 1.7X expansion represents an absolute dollar opportunity of USD 2,987 million. Increasing demand for energy-efficient cooling systems, integration with smart infrastructure, and the push toward sustainable building solutions are some of the major factors boosting the market’s revenue growth.

Modular chillers are compact, scalable cooling systems designed to provide efficient temperature control across various commercial and industrial applications. Unlike traditional chillers, they consist of multiple independent modules that can be added or removed based on cooling demand, ensuring flexibility and energy efficiency. These systems are ideal for facilities seeking redundancy, reduced downtime, and phased investment in HVAC infrastructure, making them increasingly relevant in modern building designs.

Metric	Value
Industry Size (2025E)	USD 4,316 million
Industry Value (2035F)	USD 7,303 million
CAGR (2025 to 2035)	5.4%

What are the drivers of the Modular Chiller market?

The modular chiller market is witnessing strong growth due to rising demand for energy-efficient and flexible HVAC systems. Commercial office high-rise buildings, hospitals, and medical complexes lead the way for sustainability, and modular chillers gain recognition due to the possibility of their power consumption being lower and of fewer emissions. Modular chillers are highly scalable with the possibilities of many of the units merging to provide different cooling capacities, therefore highly flexible in new construction and retrofit cases.

Smart city growth and urbanization also fuel the market. Modular chillers are simple to install, compact, and best suited for building solutions with space constraints. Plug-and-play solutions offer faster deployment with lower installation effort and time. Growing demand for green buildings and LEED-rated infrastructure also favors modular chillers because these can be installed very conveniently in energy management systems.

Advancements in technology, such as variable-speed compressors, smart and building management system interoperable, are enhancing efficiency and control of systems. Policies of governments to phase down high-emission HVAC equipment sales also are driving the low-GWP refrigerant-based modular units’ market.

As industries require efficient, adaptable chillers for cooling, and everyone has sustainability in their minds, the modular chiller is rapidly becoming the solution of preference in the developed as well as emerging world, and dominating the market growth through 2035.

What are the regional trends of the Modular Chiller market?

 

In North America, the modular chiller market is growing steadily due to strong demand from commercial buildings, hospitals, and data centers. The United States leads in terms of adoption with immense energy efficiency levels and government support through incentives on low-emission HVAC systems. The region also experiences large-scale replacement of the current infrastructure with modular chillers due to the ease of retrofitting and quick installation.

Europe is converging, with sustainability legislation driving market growth. The EU’s carbon-neutral plan and the phase-down of high-GWP refrigerants are prompting companies to adopt modular chillers. Germany and France are investing in smart and green buildings, while the U.K. is expected to accelerate adoption across hospitals and university campuses due to the flexibility and reliability of operation.

The rapidly growing Asia-Pacific region is supported by accelerating urbanization, new constructions, and rising energy demands. China, India, and Southeast Asia are developing mega-commercial hubs and computer park complexes that require highly efficient HVAC systems. South Korea and Japan already hold an advantage in adopting smart technology for chiller units.

Middle East and Africa market growth is driven by the rapidly expanding hospitality and healthcare industries. Latin America remains moderate, with Brazil and Mexico leading adoption, primarily in retrofitting activity to improve energy efficiency.

What are the challenges and restraining factors of the Modular Chiller market?

One of the main challenges in the modular chiller market is the high initial cost of installation and technology integration. While these systems offer long-term savings, the upfront investment can be a barrier for smaller businesses and public institutions. Moreover, the cost of high-efficiency components and environmentally friendly refrigerants further raises capital expenses.

Another limiting factor is the technical challenge of integrating and designing systems, especially in older buildings, which are not plug-and-play and require a significant amount of retrofitting. The need to hire highly qualified technicians for installation and maintenance further ads to operating expenses and deters uptake in developing countries.

Regulatory variations across regions present another challenge. Differences in energy and refrigerant efficiency standards require region-specific solutions, adding to production complexity and cost. In addition, the slow adoption of smart building technologies in certain areas limits the demand for high-performance chiller systems.

Shifts in the Modular Chiller Market from 2020 to 2024 and Future Trends 2025 to 2035

Between 2020 and 2024, the modular chiller market grew incrementally, underpinned by a global push for energy efficiency and climate-conscious HVAC solutions. Modular chillers, known for their scalability and operational flexibility, became increasingly attractive to commercial, industrial, and institutional facilities aiming to optimize energy consumption.

The rising construction of data centers, hospitals, and educational campuses accelerated demand for modular systems that could adapt to fluctuating load requirements. Government incentives on green building certifications like LEED also fueled market activity during the same time.

Innovation in technology was central to developing competitive forces. Advancement in compressor technology, integration of building management system (BMS), and enhanced part-load efficiency enhanced levels of performance.

Simultaneously, environmental regulation of high-GWP refrigerants encouraged use of low-GWP alternatives. While supply chain dormancy and rising material costs sometimes caused problems, industry players invested in modular manufacturing to enhance responsiveness and customization. Overall, this was a benchmark towards smart and sustainable HVAC infrastructure.

Market Shift	2020 to 2024
Regulatory Landscape	Gradual phase-out of high-GWP refrigerants, adoption of energy-efficiency codes.
Technological Advancements	Improved compressor technologies, BMS integration, and modular scaling features.
Industry-Specific Demand	Growth from commercial buildings, healthcare, and data centers.
Sustainability & Circular Economy	Emphasis on energy savings and refrigerant transitions.
Production & Supply Chain	Centralized production with occasional disruption due to material shortages.
Market Growth Drivers	Energy efficiency targets, urban expansion, and green building certifications.

Market Shift	2025 to 2035
Regulatory Landscape	Stricter global climate regulations and zero-emission building mandates.
Technological Advancements	AI-optimized load balancing, IoT-enabled predictive maintenance, and low-GWP refrigerants.
Industry-Specific Demand	Surge in demand from smart cities, green industrial parks, and hybrid HVAC systems.
Sustainability & Circular Economy	Focus on lifecycle emissions, recyclable components, and net-zero-ready modular units.
Production & Supply Chain	Regional manufacturing hubs, AI-assisted logistics, and on-demand module customization.
Market Growth Drivers	Sustainability imperatives, smart infrastructure growth, and climate adaptation strategies.

Future Outlook (2025 to 2035)

The modular chiller market will experience revolutionary growth up to 2035 fueled by sustainability regulations and investments in smart infrastructure that will encourage mass market entry. Governments and enterprises will continue to invest in climate-resilient buildings and, consequently, demand net-zero compliant modular chillers.

Technological innovation will move from hardware to software-based load optimization to enable systems to forecast and compensate for changing cooling loads in real time. Such new approach will save energy and prolong equipment life.

As cities become smarter and efficient, space and power saving HVAC technologies will take the lead particularly in building retrofitting. The rise of data-intensive applications will also require scalable and long-lasting cooling solutions. Disruptive technologies such as magnetic bearing compressors, natural refrigerants, and block chain-based service tracking are poised to become industry standards.

Modular chillers are expected to gain traction in underserved Southeast Asian, African, and Middle Eastern markets, driven by increasing access to credit and expanding regional manufacturing capabilities. Altogether, the coming decade will center on smart, sustainable, and regionally responsive HVAC ecosystems.

Country-Wise Insights

Country	CAGR
United States	4.3%
China	5.8%
Japan	6.1%

United States (U.S.)

The U.S. modular chiller market is witnessing strong growth, primarily fueled by the surging demand for energy efficient HVAC systems in commercial and industrial sectors. Greater emphasis on green building policies and legislation focused on raising energy efficiency like ASHRAE standards and LEED certifications are driving the rapid growth of modular chillers in the market.

Growing construction of data centers, smart buildings, and infrastructure retrofit in urban areas is propelling demand. Modular chillers are found to be favored due to their scalability, redundancy, and space optimization that can manage variable loads of facilities optimally with the need for operation margin as well as power efficiency. Government stimulus towards green building technology and growing investment in infrastructure refurbishment are driving market growth.

China

China's modular chiller market is undergoing rapid transformation, spurred by accelerated urbanization, expanding industrial operations, and government-led initiatives toward carbon neutrality. The "Made in China 2025" plan and other national policies encouraging high-efficiency, low-emission technologies are significantly influencing HVAC system upgrades across manufacturing, healthcare, and commercial real estate sectors.

Besides this, mega infrastructure projects like technology parks and green buildings are driving massive demand for scalable coolants. Modular chillers are gaining acceptance with their reduced cost, faster installation, and lowered operational footprint. Domestic companies are investing heavily in R&D for the introduction of next-generation chillers with smart control and IoT-enabled monitoring to make China's dream of smart city and sustainability visions a reality.

Japan

Japan’s modular chiller market is characterized by steady growth, underpinned by the country’s emphasis on energy security, compact urban construction, and environmental responsibility. Given Japan's space-constrained architecture and focus on disaster-resilient infrastructure, modular chillers offer an optimal solution with their compact form factor and modular flexibility.

Government policies such as the ZEB (Net Zero Energy Building) initiative and stringent building codes are significantly driving the adoption of high-efficiency cooling equipment in both new construction projects and retrofitting activities.

In addition to regulatory support, technological advancements characterize the Japanese market, with domestic manufacturers increasingly focusing on ultra-low-noise, smart-controlled, and low-GWP refrigerant-based modular chillers to meet evolving customer demands and regulatory compliance requirements.

Category-Wise Analysis

Compressor Chiller - By Product Type

Compressor chiller segment is growing immensely, particularly in commercial buildings where space-efficient high efficiency cooling equipment is needed. These chillers are becoming popular, as they are less expensive and simple to install, and offer flexibility in congested spaces such as small commercial offices and retail stores. Growing demand for decentralized HVAC systems in smart building infrastructures is also driving their usage.

With real estate and commercial development projects thriving across key cities in the Middle East and Asia-Pacific, compressor chillers have emerged as a reliable and efficient solution to address rising ambient temperatures without compromising energy efficiency. Complementing this trend, government incentives promoting green buildings and energy-efficient technologies are further encouraging the adoption of such systems.

As global momentum builds around scalable and modular HVAC infrastructure, the compressor chiller market is expected to maintain its growth trajectory, driven by innovations such as inverter compressor technology and the integration of IoT-enabled performance monitoring solutions.

70 - 100 Ton - By Capacity

The 70 - 100 Ton capacity range is emerging as a high-demand segment due to its optimal balance between efficiency and capacity, making it ideal for medium to large-scale commercial complexes and industrial spaces. This capacity range is especially suited for data centers, hospitality chains, and institutional buildings that require consistent cooling but want to avoid the high operational costs of larger units. With a rise in modular construction and prefabricated building systems, modular chillers in this capacity segment offer flexible installation and scalable performance, matching variable cooling loads efficiently.

The accelerating pace of digitalization and the widespread adoption of cloud computing are fueling the global expansion of data center construction, particularly across North America and Asia-Pacific. This surge is translating into increased demand for mid-range chillers, which are gaining preference due to their ability to operate with eco-friendly refrigerants and their compatibility with advanced energy management systems. These attributes make mid-range chillers an ideal solution for sustainability-driven infrastructure projects.

Water Cooled - By Cooling Technology

Water cooled modular chillers remain the industry standard as they are extremely energy efficient and their efficiency corresponds to bulk applications. Such systems are best suited for industrial buildings, skyscrapers, and large business office buildings where the cooling load is heavy and constant. Even though they are costlier to install compared to air-cooled systems, their lower lifecycle cost and better COP (Coefficient of Performance) render them cost saving in the end.

Increasing demand for green building certification in LEED and BREEAM is creating demand for water-cooled systems with full energy recovery installation and thermal storage capability. The Asia-Pacific region, spearheaded by China and India, is demonstrating healthy uptake because of the boom in commercial property and smart city development. With improved variable speed drives and intelligent water management technologies, the need for water-cooled products will likely continue to be investment and innovation-led and become a pillar for energy-efficient HVAC technologies.

R717 - By Coolant Type

R717 (Ammonia) is gaining rapid traction in the modular chiller market as an environmentally friendly, efficient coolant, especially for very large industrial and data center systems. Its unparalleled thermodynamic efficiency with zero GWP is contributing to R717 becoming a frontline contender in worldwide refrigerant transformation and climate obligations strategies.

Although traditionally used with industrial refrigeration, safety gear advances and design improvements for closed-cycle systems also qualify it as suitable for use in commercial packaged chiller facilities. Low operation costs and being well efficient at energy are the additional reasons behind its large use.

Europe and North America have been the largest users of R717 owing to stringent F-gas regulation policies and the rapid growth in adoption of natural refrigerants. Regulatory support, along with advancements in system automation and leak detection, is turning R717 into a future-proofed solution for performance as well as sustainability. The market will develop progressively, fueled by industrial decarbonization initiatives and growing demand for sustainable, high-capacity cooling solutions.

Data Center - By End Use Sector

The data center end-use sector is among the rapidly growing verticals in the modular chiller market, driven by exponential growth in cloud computing, AI workloads, and edge computing infrastructure. These facilities demand uninterrupted, high capacity cooling with minimal downtime and high-energy efficiency attributes where modular chillers, especially those supporting scalable design and rapid deployment, excel. With hyper-scale data centers emerging globally, especially in regions like North America, Southeast Asia, and the Nordics, there is a surge in investment in advanced cooling technologies that offer flexibility and reliability.

Modular chillers readily provide redundancy and load management as well, and that is required for Tier III and Tier IV data center needs. The pressure to become carbon-free is also compelling the transition to low-GWP refrigerants and optimized chiller design. With edge computing hitting the cities and latency in focus, modular chiller systems will be important in facilitating the future expansion of digital infrastructure.

Competitive Analysis

Key players in the Modular Chiller Market include Carrier Corporation, Daikin Industries, Ltd., Johnson Controls, Trane Technologies plc, Mitsubishi Electric, LG Electronics, Midea Group, Haier Group, Gree Electric Appliances, Inc., and Blue Star Ltd., Euroklimat, Frigel Firenze S.p.A., Hitachi Air Conditioning, Ingersoll Rand, Multistack, LLC.

Increasing commercial and industrial applications for energy-efficient heating, ventilation, and air-conditioning equipment are propelling the market. Government investments in smart infrastructure, green building certification, and carbon emission regulations are propelling modular chiller applications.

Technologies like variable-speed compressors, Internet of Things technology for performance monitoring, and natural refrigeration are transforming industries. They are concentrating on sustainability, energy efficiency, and units of scalable capacities to address demand in matured economies and emerging economies.

Market Share Analysis by Company

Company Name	Estimated Market Share (%), 2024
Top 5 Players	~48-55%
Tier II Players	~25-32%
Other Players	~15-20%

Key Company Offerings and Activities

Company Name	Key Offerings/Activities
Carrier Corporation	Offers modular chillers with SmartVu™ control systems; focuses on energy-efficient, low-GWP units.
Daikin Industries, Ltd.	Supplies air-cooled and water-cooled modular chillers; emphasizes inverter technology and heat recovery.
Johnson Controls	Delivers YORK® modular chillers optimized for variable load conditions and smart building integration.
Trane Technologies plc	Specializes in scalable modular chillers with advanced diagnostics and eco-friendly refrigerants.
Mitsubishi Electric	Produces compact modular chillers with precise temperature control; integrates energy-saving features.
LG Electronics	Offers modular chillers suited for VRF and commercial cooling systems; focuses on IoT-enabled solutions.
Midea Group	Develops modular chillers with eco-design principles; targets cost-optimized, high-volume production.
Haier Group	Supplies smart modular HVAC systems with AI-based performance optimization and smart diagnostics.
Blue Star Ltd.	Offers customized modular chiller units with R-134a and R-410A refrigerants; focuses on emerging markets.

Carrier Corporation

Carrier Corporation is a leading global HVAC business and recognized through its SmartVu™-equipped modular chillers with responsive, energy-conserving solutions for mega-buildings. Carrier attempts to reduce environmental impact with the use of low-GWP refrigerants and digital integration leadership with a view towards facilitating real-time monitoring, fault detection, and system optimization.

Daikin Industries, Ltd.

Daikin offers a wide range of modular chillers for both air and water-cooled systems, incorporating inverter technology for energy savings. With a strong global footprint, the company is investing in R&D for low-carbon HVAC solutions, including natural refrigerants and heat recovery capabilities, to align with net-zero targets.

Johnson Controls

Johnson Controls, through its YORK® brand, leads in smart modular chiller systems designed for commercial, healthcare, and industrial environments. It prioritizes sustainability with high-efficiency compressors and integrates its solutions into intelligent building platforms for optimal HVAC performance.

Trane Technologies plc

Trane is focused on scalable capacity, front-running building integration, and modular chiller technology. It offers variable-speed compressors air-cooled chillers and eco-friendly refrigerants in its products. Trane is a pioneer in low-emission cooling technology and decarbonizes the world through collaborations and innovations.

Mitsubishi Electric

Mitsubishi Electric provides compact modular chillers with high control accuracy and low power consumption. Mitsubishi Electric is taking advantage of automation and AI to drive operations efficiency. Its solutions are highly flexible for data centers, hospitals, and commercial premises in Asia, Europe, and North America.

Recent Development

• In March 2025, Smardt launched the AeroPure™ AF Series, its latest line of air-cooled chillers featuring oil-free, magnetically suspended compressors. Designed for data centers and comfort cooling, the AF Series offers high energy efficiency, low-GWP refrigerant options, and advanced onboard controls for seamless integration into building management systems.
• In November 2023, Trane introduced the Aries N Propane Chillers, a modular air-to-water solution utilizing R-290 natural refrigerant with ultra-low GWP. Designed for high efficiency and minimal environmental impact, the chillers feature compact design, low-noise operation, and scalability for various building applications.
• In October 2023, ThermalWorks introduced a modular, waterless cooling system designed for high-density IT loads. Capable of supporting up to 200 kW per rack, the system eliminates water use and reduces energy consumption by 73%, offering a sustainable solution for data centers in water-scarce regions.

Fact.MR has provided detailed information about the price points of key manufacturers of Modular Chiller Market positioned across regions, sales growth, production capacity, and speculative technological expansion, in the recently published report.

Segmentation of Modular Chiller Market

• By Product Type :

  • Compressor Chiller
  • Screw Chiller
    • Centrifugal Chiller
    • Scroll Chiller
    • Reciprocating Chiller
  • Absorption Chiller

• By Capacity :

  • Up to 30 Ton
  • 30 - 50 ton
  • 50 - 70 ton
  • 70 - 100 Ton
  • 100 - 150 tons
  • Above 150 Tons

• By Cooling Technology :

  • Air Cooled
  • Water Cooled
  • Evaporative Condensed

• By Coolant Type :

  • R134A
  • R744
  • R717
  • HCFC (R2, R123, R124, R151)
  • HCS (R600A, R290)
  • R407C
  • R404A
  • R410A
  • R448A
  • R449A
  • Others

• By End Use Sector :

  • Commercial
    • Corporate Office
    • Data Center
    • Hospitality Sector
  • Industrial
    • Chemical & Petrochemical
    • Healthcare
    • Plastic & Polymer
    • Food & Beverage
    • Oil & Gas
    • Energy & Power
    • Automotive
    • Discrete Manufacturing

• By Region :

  • North America
  • Latin America
  • Western Europe
  • Eastern Europe
  • East Asia
  • South Asia & Pacific
  • Middle East & Africa