Executive Roundtable: CapEx vs. OpEx in the AI Era - Balancing the Rush to Build with Long-Term Efficiency
For the second installment of our Executive Roundtable for the Third Quarter of 2025, we turn to one of the central dilemmas facing the industry: how to balance the breakneck pace of AI-driven construction with the need for long-term operational efficiency.
AI data centers are being built at a scale and speed never before seen — often measured in gigawatts — with cooling and water systems under intense scrutiny for both cost and sustainability. The challenge for operators is finding solutions that deliver immediate capacity while avoiding efficiency trade-offs that could become long-term liabilities.
We asked our panel of experts how they are helping operators strike the right balance between capital expenditure and operational efficiency in thermal and water systems, especially in the context of AI build urgency.
Our distinguished panelists this quarter bring expertise across liquid cooling, water chemistry, and system-level HVAC integration. They include:
- Brandon Peterson, Senior Vice President of Business Development, CoolIT Systems
- Mukul Girotra, Senior Vice President and General Manager, Global High-Tech Division, Ecolab
- Becky Wacker, Vice President – Data Center Solutions, Trane
In response to our inquiry, CoolIT's Brandon Peterson highlights how liquid cooling not only meets the thermal needs of AI processors but also drives significant CapEx and OpEx savings by reducing reliance on air infrastructure, lowering fan and chiller loads, and enabling warm-water efficiency at gigawatt scale.
For his part, Mukul Girotra emphasizes Ecolab’s early role in site selection and cooling design, helping operators balance water and power efficiency while minimizing environmental impact, then extending that optimization through digital tools and continuous improvement once facilities are live.
Finally, Becky Wacker of Trane underscores her company's holistic approach to balancing CapEx and OpEx via smart services, sustainable system design, and flexible financing models, enabling operators to maintain efficiency, resilience, and sustainability as AI-driven demand accelerates.
And now onto the second Executive Roundtable question for Q3 of 2025.
Data Center Frontier: How are you helping data center operators strike a balance between capital expenditure and long-term operational efficiency in thermal and water systems, especially amid AI build urgency?
Brandon Peterson, CoolIT Systems: We’re proud to offer a technology that improves both capital expenditures (CapEx) and long-term operational efficiency (OpEx), especially when compared to legacy air-cooling solutions.
While data center operators are increasingly adopting liquid cooling to meet the thermal requirements of modern processors, the technology also brings valuable secondary benefits. Liquid cooling enables data centers to reduce or eliminate a substantial part of the air-cooling infrastructure that would otherwise be required.
In terms of efficiency, liquid cooling lowers the power server fans consume, reduces the need for air conditioning and air handling within the data hall, and decreases the load on facility-level equipment, especially when systems are designed for warm-water operation.
With AI data centers now being built at gigawatt scale, the resulting CapEx and OpEx savings are significant.
Mukul Girotra, Ecolab: First, we’re collaborating very early on in the site selection process to help our customers evaluate what cooling topology for a given region is truly most sustainable with least holistic impacts on watersheds and power grids. This includes evaluation of climate, geography, source of power generation, water sources available, their respective qualities, as well as local water stress/strain.
In taking this approach, we can support in the evaluation of what cooling topologies are able to drive the best balance between WUE and PUE interests, which in turn can allow for allocation of as much power to compute (increasing that amount of compute per interconnection) as possible. Which in aggregate can have considerable positive impacts on power grids and watersheds.
When a decision is made to use water as part of data center cooling topologies, as part of our design consultation, we’re also able to identify continuous improvement projects within identified customer ROI/IRR that drive reductions in total cost of operation.
Once a data center is up and running, through deployment of our technology and digital innovation we’re able to support our strategic partners in continuing to align operational and design efficiencies and identify opportunities for efficiency capture.
Becky Wacker, Trane: Focusing on post-initial construction CapEx expenditures, finding a balance between capital expenditure (CapEx) and operational expenditure (OpEx) is crucial for efficient capital deployment for data center operators. This balance can be influenced by ownership strategy, cash position, budget planning duration, sustainability goals, and contract commitments and durations with end users.
At Trane, we focus on understanding these key characteristics of operations and tailor our ongoing support to best meet the unique business objectives and needs of our customers. We address these challenges through three major approaches:
1. Smart Services Solutions: Our smart services solutions improve system efficiency through AI-driven tools and a large fleet of truck-based service providers. By keeping system components operating at peak efficiency, preventing unanticipated failures, and balancing the critical needs of both digital monitoring and well-trained technicians, we maintain critical systems. This approach reduces OpEx through efficient operation and minimizes unplanned CapEx expenditures. Consequently, this enables improved budgeting and the ability to invest in additional data centers or other business ventures.
2. Sustainable and Flexible System Design: As a global climate innovator, Trane designs our products and collaborates with engineers and owners to integrate these products into highly efficient system solutions. We apply this approach not only in the initial design of the data center but also in planning for future flexibility as demand increases or components require replacement. This proactive strategy reduces ongoing utility bills, minimizes CapEx for upgrades, and helps meet sustainability goals. By focusing on both immediate and long-term efficiency, Trane ensures that data center operators can maintain optimal performance while adhering to environmental standards.
3. Flexible Financial Solutions: Trane’s Energy Services solutions have a 25+ year history of providing Energy Performance Contracting solutions. These can be leveraged to provide upgrades and energy optimization to cooling, power, water, and building systems, reducing PUE without upfront capital deployment. Additionally, Energy as a Service (EaaS) for Microgrid and Resiliency or Cooling as a Service (CaaS) are tools operators can use to shift CapEx to OpEx budgets while meeting key business metrics. These flexible financial solutions help operators manage their expenditure more effectively, ensuring they can meet their financial and operational goals.
By focusing on these three key areas, Trane helps data center operators strike a balance between CapEx and long-term operational efficiency, enabling them to meet the urgent demands of AI builds while maintaining financial and operational stability.
About the Author
Matt Vincent
A B2B technology journalist and editor with more than two decades of experience, Matt Vincent is Editor in Chief of Data Center Frontier.
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