Chill out: Japan’s top vending machine maker now cools data centres

Japan’s biggest vending machine maker has reworked its refrigeration technology to offer power-hungry AI data centres an energy-efficient way to cool their servers.

Fuji Electric, which makes 80 per cent of Japan’s vending machines, has created a cooling system for data centres that it claims can cut energy consumption by 85 per cent, using a technology originally designed to chill sodas, teas and coffees.

The push is the latest by a Japanese industrial group to reinvent itself as a key supplier of components used in AI infrastructure, joining the likes of Panasonic, Mitsubishi Electric and Sumitomo Electric.

Cooling servers accounts for 30 to 40 per cent of data centres’ energy consumption, presenting a big opportunity for Japanese companies specialising in air conditioning and refrigeration.

Fuji Electric’s technology was born out of efforts to make vending machines more energy efficient after they became a symbol of waste following the Fukushima nuclear meltdown in 2011.

Shintaro Ishihara, Tokyo’s governor at the time, had gone as far as demanding a complete shutdown of vending machines to save energy as Japan faced a power crunch in the disaster’s aftermath.

That call prompted Fuji Electric and Toyota supplier Denso to develop a new cooling system. In 2015, a team of researchers created an ejector using a CO₂ refrigerant that did away with the need for a compressor and saved energy by 20 per cent, according to the company.

“Simply extending conventional technology wouldn’t have been enough,” said Hideto Shirai, who is leading efforts at Fuji Electric to sell the technology to data centres.

Most cooling systems deploy a compressor, which uses a large amount of electricity to turn a refrigerant into a hot, high-pressure gas. Fuji Electric’s ejector uses waste heat to drive refrigerant through a precisely shaped nozzle and raise its pressure through the movement of fluid.

However, the technology was never adopted inside vending machines because it was too costly to install when the machines only cost a few thousand dollars.

“We knew the technology was effective,” said Shirai. “But it was difficult to make it blossom inside vending machines. So the idea began: what if we applied it to a different industrial field?”

The Tokyo-based electrical equipment supplier is aiming to sell more than ¥10bn ($61mn) worth of ejector systems to data centres by 2030. It already sells ¥100bn a year in data centre-related components such as switchgears.

The company’s role as an AI “picks and shovels” supplier, as well as improving margins in its energy components business, has helped Fuji Electric’s shares rise almost 47 per cent in the past year. The company is valued at $13.9bn.

Alex Cordovil, research director at Dell’Oro, a research group specialising in data centre infrastructure, called the technology “promising” but said it was still “genuinely emerging”.

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The data centre cooling market is shifting from traditional systems that use water and glycol or hydrofluoroolefin refrigerants towards direct liquid cooling, which circulates a liquid coolant directly to heat-generating components such as CPUs and GPUs.

Fuji Electric’s system could be used in direct liquid-based cooling systems. The ejector technology performs better in regions with high temperatures, creating a potential opening in parts of Japan, where summer heat can often exceed 35 degrees, and south-east Asia.

But Cordovil said a rival technology that uses waste heat — absorption chillers made by Japan’s Kawasaki, Ebara and Yazaki — had an edge over Fuji’s system for data centre adoption.

Ryo Harada, analyst at Goldman Sachs, expressed doubts about whether Fuji Electric would be able to access the large US data centre market.

“The technology may be compelling, but commercialisation is equally important,” he said. “Hyperscalers have largely locked in their next-generation data centre architectures for the next two to three years, so it is likely to take at least that long for new entrants to gain meaningful traction.”