Centrifugal chillers are used for cooling large buildings in a centralized air conditioning system. There are other types of chillers using screw compressors and reciprocating compressors. These are usually smaller in size.

Centrifugal compressors use one or more rotating impeller to increase the refrigerant vapor pressure from the chiller evaporator enough to make it condense in the condenser. Unlike the positive displacement, reciprocating, scroll or screw compressors, the centrifugal compressor uses the combination of rotational speed (RPM), and tip speed to produce this pressure difference. The refrigerant vapors from the chiller evaporator are commonly pre-rotated using variable inlet guide vanes. The consequent swirling action provides extended part-load capacity and improved efficiency. The vapors then enter the centrifugal compressor along the axis of rotation.

The vapor passageways in the centrifugal compressor are bounded by vanes extending form the compressor hub, which may be shrouded for flow-path efficiency. The combination of rotational speed and wheel diameter combine to create the tip speed necessary to accelerate the refrigerant vapor to the high pressure discharge where they move on to the chiller condenser. Due to their very high vapor-flow capacity characteristics, centrifugal compressors dominate the 200 ton and larger chiller market, where they are the least costly and most efficient cooling compressor design. Centrifugals are most commonly driven by electric motors, but can also be driven by steam turbines and gas engines.

Depending on the manufacturer's design, centrifugal compressors used in water chiller packages may be 1-, 2-, or 3-stages and use a semi-hermetic motor or an open motor with shaft seal.