The AC clutch pulley allows the engine belt to run without turning the A/C compressor constantly. The pulley has an internal bearing that spins freely on the compressor snout. When you turn on the dashboard A/C button, an electromagnetic coil pulls the clutch plate against the spinning pulley, locking them together.
Once engaged, the pulley drives the compressor shaft to pump refrigerant. When you turn the A/C off, the coil loses power. A set of springs pulls the clutch plate back, allowing the pulley to spin freely again.
Pulley bearings wear out over time, causing a loud grinding or squealing noise under the hood. If the bearing seizes completely, it can snap the accessory belt. Changing the pulley and bearing separately is possible without opening the A/C lines.