Major PFAS producers are expanding capacity as AI infrastructure increases demand for chemicals used in data-center cooling, semiconductor manufacturing and battery materials. Companies including Chemours, Daikin and Arkema are expanding PFAS-related operations, while some newer cooling systems use fluorinated chemicals to manage heat from high-performance computing equipment.
Key Takeaways
- ChemSec identified data-center cooling, semiconductor manufacturing and lithium-ion battery materials as major sources of PFAS demand.
- Chemours is developing PFAS-based products for data-center cooling and expanding production of PFAS refrigerants.
- Daikin plans to triple its PFAS capacity in response to semiconductor demand, according to ChemSec’s report.
- Arkema is expanding PFAS production in North America and Asia.
- ChemSec says some newer cooling systems use fluorinated chemicals instead of water to remove heat from data-center equipment.
AI Data Center Cooling Increases Demand for PFAS
ChemSec’s analysis identifies AI data-center cooling as one of three demand sources contributing to expanded PFAS production. Semiconductor manufacturing and lithium-ion battery materials are the other two uses identified in the report.
PFAS, or per- and polyfluoroalkyl substances, are a large group of fluorinated chemicals. Their resistance to heat and chemical breakdown makes some PFAS useful in industrial applications, including cooling systems and semiconductor manufacturing.
The cooling application relates to the amount of heat produced by high-performance computing equipment. Newer liquid-cooling approaches can use fluorinated chemicals in systems designed to remove heat from servers while reducing the amount of water used for cooling.
ChemSec said the world’s largest PFAS producers are increasing capacity in response to demand connected with AI infrastructure. The organization’s September analysis examined the production plans and PFAS exposure of major chemical manufacturers.
The connection between AI infrastructure and PFAS production does not apply only to data-center cooling. ChemSec’s analysis also identifies semiconductor production and battery materials as significant applications, making the reported capacity increases relevant to several parts of the technology supply chain.
Recent investment in semiconductor capacity has also been tied directly to AI computing demand. U.S. semiconductor manufacturing expansion has included facilities and technologies serving data-center and specialized computing applications.
Major Chemical Producers Expand PFAS Capacity
Chemours is among the companies identified in the ChemSec analysis. The U.S. chemical manufacturer produces and uses multiple PFAS substances, and ChemSec estimates that between half and two-thirds of the company’s $5.8 billion in revenue comes from PFAS production.
Chemours is also developing products intended for data-center cooling while expanding production of PFAS refrigerants, according to the report. The company launched additional refrigerants in August as it continued developing products for cooling applications.
Daikin is another major producer included in the analysis. ChemSec reported that the Japanese company plans to triple its PFAS capacity in response to semiconductor demand. The reported expansion therefore covers semiconductor applications in addition to data-center infrastructure.
Arkema is also expanding production, with activity planned in North America and Asia. The company is a major materials manufacturer whose fluorinated products are used in industrial and technology applications.
The capacity plans identified by ChemSec differ by company and application. The report links them collectively to demand from data centers, semiconductor manufacturing and battery materials rather than attributing every planned expansion exclusively to AI cooling.
The capacity additions also fit into a larger buildout of technology infrastructure. Intel, for example, has reported increased investment in manufacturing capacity connected to enterprise demand for AI-related data-center processors.
Fluorinated Cooling Systems Reduce Reliance on Water
Some data-center cooling systems use fluorinated chemicals in place of water. The approach is associated with two-phase cooling, in which a liquid absorbs heat and changes into vapor before condensing back into liquid.
PFAS-based two-phase cooling remains a specialized application rather than the dominant cooling method across data centers. ChemSec said most data centers still rely primarily on air cooling, while single-phase liquid cooling that does not use PFAS is also widely deployed.
Single-phase systems can circulate liquids such as water, glycol or synthetic fluids through cooling equipment without requiring the fluid to evaporate. Direct-to-chip systems are one example, with liquid moving through sealed channels around server components to carry away heat.
Two-phase systems use the heat-transfer properties of low-boiling-point fluids. ChemSec said fluorinated chemicals can be used in these systems because they evaporate at relatively low temperatures, allowing them to absorb heat directly from equipment.
The different cooling approaches mean that PFAS demand cannot be equated with overall data-center cooling demand. The ChemSec report connects PFAS production increases to the cooling segment, while its technical analysis says PFAS-based cooling is still a niche technology.
Water consumption is one factor in cooling-system selection. Data-center projects also require large amounts of supporting infrastructure, including electrical equipment and power capacity.
Semiconductor Manufacturing Adds to PFAS Demand
Semiconductor manufacturing represents another source of PFAS demand identified by ChemSec. Fluorinated materials are used in semiconductor production because their chemical and thermal properties support manufacturing processes involving advanced electronic components.
Daikin’s planned capacity increase is specifically linked in the ChemSec report to semiconductor demand. The company plans to triple its PFAS capacity, making chip manufacturing an important part of the reported expansion.
The report also identifies lithium-ion battery materials as a third major demand source. That means the production capacity being added by chemical manufacturers can serve multiple technology industries rather than a single AI application.

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ChemSec’s analysis therefore connects PFAS manufacturing with several parts of the technology supply chain. Data-center cooling provides one application, while semiconductor production and battery materials create separate industrial requirements for fluorinated chemicals.
The distinction is relevant to companies assessing chemical supply requirements. A manufacturer’s capacity expansion may support several end markets simultaneously, making it difficult to attribute a particular production increase solely to data-center construction or AI computing. ChemSec’s report identifies the combined sources of demand rather than assigning all additional capacity to one industry.
The semiconductor connection is also visible in U.S. manufacturing investment. Companies such as GlobalFoundries and Intel have reported investments tied to computing and semiconductor capacity, while memory manufacturers are expanding facilities and research connected to AI hardware.
Those projects require more than chip fabrication equipment. Semiconductor facilities also depend on specialized chemicals, materials, power systems, water systems and other industrial infrastructure. PFAS therefore represents one component of a much larger manufacturing supply chain.
Data Center Cooling Creates New Chemical Supply Requirements
ChemSec’s findings place cooling chemicals alongside servers, chips and other physical components required for AI infrastructure. The organization says major PFAS producers are expanding capacity as demand develops across data centers, semiconductors and batteries.
For data-center operators, the choice of cooling system determines the type of fluid and equipment required to remove heat from computing systems. Air cooling, direct-to-chip liquid cooling and two-phase immersion cooling use different technical approaches and materials.
Chemours has specifically developed products for the data-center cooling market. The company has described its cooling products as part of its effort to supply systems used by data centers and other facilities requiring cooling equipment.
The use of PFAS in cooling has also prompted scrutiny of the chemicals involved. In July, 17 environmental organizations asked the Environmental Protection Agency to reject Chemours’ application to fast-track Opteon 2P50, a PFAS chemical proposed for data-center cooling. The groups cited concerns about potential health and climate risks.
Chemours disputed those concerns, according to the report, saying the cooling system operates as a closed loop and that the amount of gas escaping during operation is low. The company has continued developing and introducing refrigerants for cooling applications.
ChemSec has also pointed to alternatives to PFAS-based cooling. Its technical analysis says single-phase PFAS-free liquid cooling is already widely used and identifies water, glycol and other fluids as alternatives. It also describes natural refrigerants including carbon dioxide, ammonia, isobutane and propane as commercially available options for certain cooling applications.
The cooling market therefore includes multiple technologies with different fluid requirements. PFAS-based systems represent one specialized approach within that market, while other cooling methods are already deployed across data-center infrastructure.
The physical infrastructure required for data centers also extends beyond cooling equipment. Financing assessments increasingly include technical, environmental and construction considerations, alongside conventional financial analysis.
For chemical manufacturers, the reported capacity expansions connect PFAS production to several technology markets at once. For data-center operators, the available cooling systems include both fluorinated and non-fluorinated approaches, each requiring different equipment and materials.
Frequently Asked Questions
What is AI data center cooling?
AI data center cooling refers to systems used to remove heat generated by high-performance computing equipment. These systems can use air, direct-to-chip liquid cooling or immersion-based approaches, depending on the facility and equipment.
Why are PFAS chemicals used in data center cooling?
Some PFAS compounds have properties that make them suitable for two-phase cooling, including relatively low boiling points and resistance to heat. These systems can use fluorinated liquids to absorb heat from computing equipment.
Which companies are expanding PFAS production?
ChemSec identified companies including Chemours, Daikin and Arkema among major PFAS producers expanding capacity. The reported expansions serve multiple applications, including data centers, semiconductor manufacturing and battery materials.
How are data centers using fluorinated cooling systems?
Some data centers can use fluorinated liquids in two-phase cooling systems. The liquid absorbs heat from computing equipment, evaporates and then condenses back into liquid within the cooling system.
What industries besides data centers use PFAS?
ChemSec identifies semiconductor manufacturing and lithium-ion battery materials as additional sources of PFAS demand. These applications contribute to the production-capacity increases reported among major PFAS manufacturers.