Residential air conditioners are small, direct-fired absorption chillers.   An absorption chiller uses a refrigerant, absorbent and heat to create a cooling effect.  Simply put, the cooling effect is accomplished with the removal of heat through evaporation of a fluid (refrigerant) at low pressure and the rejection of heat through the condensation of a fluid (refrigerant) at a higher pressure. 

The absorption process relies on the affinity between two fluids.  Air-cooled chillers utilize environmentally safe ammonia as the refrigerant and water as the absorbent.  In the chiller unit, heat provided by a gas burner boils the ammonia out of the water and condenses it in an outdoor coil.  The ammonia is then evaporated at low pressure, cooling a circulating water system.  The chilled water circulates through the area to be cooled via a piping system eliminating the need for ductwork and making the system well suited to homes with baseboard heating.  The ammonia is then reabsorbed into the water (the absorption process) and the cycle repeats.  Click here to see a diagram of the residential absorption cooling process.