VRV/VRFs are typically installed with an air conditioner inverter which adds a DC inverter to the compressor in order to support variable motor speed and thus variable refrigerant flow rather than simply perform on/off operation. By operating at varying speeds VRV /VRF units work only at the needed rate allowing for substantial energy savings at load conditions. Heat recovery VRF technology allows individual indoor units to heat or cool as required, while the compressor load benefits from the internal heat recovery. Energy savings of up to 55% are predicted over comparable unitary equipment. This also results in greater control of the building's interior temperature by the building's occupants.VRF systems may be air or water cooled.
If air cooled, VRV/VRF condensing units are exposed to outside air and may be outdoors, and condensing units are the size of large refrigerators, since they need to contain a large condenser (heat exchanger) which has a large surface area to transfer heat to the surrounding air, because air doesn't have a high heat capacity and has a low density, volumetric thermal capacity and thermal conductivity thus needing to transfer heat into a large amount of air volume at once. If water cooled, the condensing units are placed indoors and are much smaller and cooled with water by a closed type or circuit cooling tower or dry cooler.