If your goal is to do research, a PhD is the way to go. There are lots of cases of people with master's degrees doing successful research, but as far as academia goes, competition is fierce and not having the PhD is a major obstacle both in terms of artificial hoops (such as funding applications) and in terms of missing out on the rigorous aspects of your education in how research is done. In my experience MSc level researchers are usually working more as lab technicians - assisting others with research, but doing very little on their own.
I can't speak much to the first question though as I have little experience in the field, but I would strongly suspect it's possible to get involved. Especially at the practical implementation level you don't need so many PhDs working on the theoretical aspects of getting the reaction right as you need engineers designing and building the pumps for the cooling systems.