Elice Group to Invest 330 Billion Won in 40MW Modular AI Data Center in Honam

Elice Group is committing 330 billion won ($230 million) to build modular data centers in South Korea's Honam region, a move that underscores how surging AI demand is reshaping the economics and timelines of data center construction. The investment will fund a 40-megawatt AI modular data center, or AI PMDC, using technology the company developed in-house, and will include securing infrastructure such as graphics processing units.

The shift toward modular designs reflects a broader industry push to bring capacity online faster than conventional facilities allow. A modular data center is assembled from standardized components, with container-based designs the most common. All equipment may be housed in a single container, or roughly four containers may be installed with computing and power generation functions divided among them. The approach can cut construction time to under a year, compared with more than three years for traditional builds.

Park Jung-kook, chief technology officer of Elice Group, said in an interview with The Seoul Economic Daily that demand for modular data centers is mounting even as the AI market remains difficult to forecast. "It is hard to predict the AI market these days, but we are seeing a lot of demand for modular data centers," Park said. He added that when a new chip is released, strong demand emerges for modular data centers during the process of designing and validating facilities for it, and that the company has received inquiries from India and Indonesia about turnkey construction-to-operation services.

GPUs are cited as the primary reason Elice Group began focusing on modular data centers. The need to design and build optimized facilities that reflect the performance of GPUs released each year is growing, and liquid cooling is projected to account for close to 90% of cooling systems in modular data centers. Air-cooled infrastructure at existing data centers struggles to handle the high-density power draw and heat output that the latest AI GPUs require.

Park noted that existing data centers were built without any assumption that water would be used to remove heat, so cables were laid underneath and water piping later had to be routed overhead despite the risk of leaks. "A modular data center, by contrast, can be designed from the start with liquid cooling in mind, putting cables above and water piping below," he said.

Elice Group has gone further, developing what it says is the country's first liquid cooling and outside-air cooling method using water heated above 40 degrees Celsius. "Water at 40 degrees can still cool a GPU running at 70 to 80 degrees," Park said. "Previously, data centers and cooling systems were designed on the assumption that cold water was safer, but advances in technology such as cold plates have made cooling with warm water possible." The technology will be applied to a modular data center to be built under a program to strengthen the use of AI computing resources, promoted by the Ministry of Science and ICT and the National IT Industry Promotion Agency (NIPA).

Elice Group, which started as an AI education platform, is expanding its cloud business around AI PMDC. The company currently operates 10 container-type modular data centers across the country and plans to expand them, centered on the Seoul metropolitan area and the Honam region. "Demand for data centers that work even in extreme conditions is going to keep growing, so I think it will be hard to go back to conventional data centers," Park said. "When new conditions emerge, the process of designing and validating for them is where our capabilities will show."