A chilled-water applied system uses chilled water to transport heat energy between the airside, chillers and the outdoors. These systems are more commonly found in large HVAC installations, given their efficiency advantages.

The components of the chiller (evaporator, compressor, an air- or water-cooled condenser, and expansion device) are often manufactured, assembled, and tested as a complete package within the factory. These packaged systems can reduce field labor, speed installation and improve reliability.

Alternatively, the components of the refrigeration loop may be selected separately. While water-cooled chillers are rarely installed as separate components, some air cooled chillers offer the flexibility of separating the components for installation in different locations. This allows the system design engineer to position the components where they best serve the space, acoustic, and maintenance requirements of the building owner.