Both are available. According to the query Popular Science China.
1. Air-cooled generator: Use one or more large fans to force exhaust air to the generator body to dissipate heat. Its advantages are simple structure, easy maintenance, and no danger of freezing or overheating and boiling. The generator set is limited by thermal load and mechanical load, has low power, and the power conversion rate of the generator set is also low, which is not energy-saving enough. The air-cooled machine must be installed in an open cabin, which has high environmental requirements and high noise. Noise reduction treatment in the machine room is required. The air cooling method is more commonly used in small gasoline generators and low-power diesel generator sets.
2. Water-cooled generator: The water circulates inside and outside the body, and the heat generated inside the body is taken away through the water tank and fan. Both functions are to dissipate heat into the air, and there is no difference in use. The advantages of water-cooled units are ideal cooling effect, rapid and stable cooling, and high power conversion rate of the unit itself. The water-cooled unit has small installation site limitations, small environmental requirements, low noise, and can also implement a remote cooling system. Water cooling method is used in small diesel generators and high-power diesel generator sets.