PFAS manufacturers plan production surge to meet AI data center demand

Watchdog warns of new wave of forever chemicals entering environment

ChemSec, a Swedish chemicals watchdog, said Monday that nearly all of the 10 largest PFAS manufacturers plan to expand production to meet demand from the AI industry, with semiconductor manufacturing and data center cooling cited as the primary growth areas driving their expansion plans. The watchdog said the expansion plans risk undermining nascent moves to restrict PFAS in Europe, the United Kingdom, and parts of the United States.

“These companies’ expansion plans show that unless governments and regulators insist on a rapid phaseout, we will face a new tidal wave of forever chemicals,” Anne-Sofie Bäckar, ChemSec’s executive director, said.

The findings land as regulators on both sides of the Atlantic weigh restrictions on per- and polyfluoroalkyl substances, which have been linked to cancer, liver disease, kidney issues, high cholesterol, and birth defects. Scientists have warned that PFAS accumulation has already breached a planetary boundary, and the chemicals are thought to contaminate the blood of nearly every living person.

Three of the manufacturers provided specific examples of their AI-driven expansion plans. Japan’s Daikin said it was launching a “datacentre hub” and pledged to “maintain and expand our top share in the industry by expanding sales of existing fluorine products and introducing new products.” France’s Arkema announced a new $60 million (£44 million) production unit in Kentucky that, the company said, “will enable us to follow the rapid expansion of datacenters’ cooling needs.”

The American producer Chemours, recently ordered to pay $450 million to settle a lawsuit over PFAS discharges, said it was expanding to meet demand from “advanced datacenters and AI hardware.” Chemours described its “innovative liquid cooling solutions” as lowering the energy, water, space, maintenance, and investment costs of data centers, though critics have accused the company of downplaying the chemicals’ toxicity and climate impact.

Other manufacturers increasing production include Japan’s AGC, China’s Dongyue, India’s Gujarat Fluorochemicals, Russia’s HaloPolymer, Mexico’s Orbia Fluor & Energy Materials, US-based Solstice, and Belgium’s Syensqo. Producers also cited PFAS coatings and binders for lithium-ion batteries used in electric vehicles, laptops, and phones as a parallel growth area. Gujarat Fluorochemicals chief executive Bir Kapoor recently identified batteries as one of several “sunrise sectors,” alongside data centers, semiconductors, and green hydrogen. “There is a tremendous growth opportunity there,” he said.

Two of the ten companies surveyed are moving in the opposite direction. Switzerland’s Archroma, which is switching to marketing PFAS-free alternatives, and Germany’s BASF, which has said it will exit PFAS production by 2028, were the only clear exceptions.

The chemicals have become embedded in two fast-growing segments of AI infrastructure. In “two-phase immersion cooling” systems, servers are immersed in a pool of low-boiling-point PFAS; as the hardware heats up, the fluid boils, drawing heat away as vapor, which then rises to a water-cooled condensing coil at the top of the tank, cools back to liquid, and re-enters the cycle. PFAS also play a crucial role in semiconductor fabrication, where, according to a recent Danske Bank investor note, the chemicals are “essential ingredients integrated into as many as 1,000 distinct steps at the nanometric level.” Analysts have also warned of “the hidden risk of the AI boom,” citing “escalating potential for multibillion-euro remediation and litigation liabilities.”

The carbon-fluorine bonds in PFAS are among the strongest in organic chemistry, making the substances both exceptionally useful and virtually indestructible in the natural environment. As a result, they continue to be recycled through planetary systems, accumulating in air, water, and soil and moving up the food chain. Although PFAS have existed for less than a century, scientists have warned that their accumulation has already breached a planetary boundary.

ChemSec sent finger-prick blood tests to the chief executives of all the European companies in its top 10, encouraging them to test PFAS levels in their own blood and share the results publicly. “The people who lead them must understand that they too are affected by the toxins they produce, which have been detected in the blood of more than 99% of people worldwide,” Bäckar said.