October 27, 2015

India likely to experience continued growth in electricity use for air conditioning

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Energy demand for space cooling is growing rapidly in India and around the world, driven by rising incomes and a natural preference for certain ambient air temperatures.

Cooling degree days (CDD) measure temperatures compared with a specific temperature or comfort level and are often used to measure potential weather-related energy consumption. All else being equal, locations with high levels of cooling degree days and large populations tend to have significant demand for air conditioning. For instance, four large cities in India are much larger than Los Angeles, California, and they also have more cooling degree days than Miami, Florida, one of the hottest metropolitan areas in the United States.

Currently, India has a relatively low penetration of air conditioning, while the United States is a much more saturated market. The latest data from EIA's Residential Energy Consumption Survey (RECS) show that 87% of U.S. households have air-conditioning equipment. Similar data for India show just 2% of Indian households have air conditioning. However, air conditioners are among the most prevalent purchases for the growing Indian middle class, with air conditioner sales increasing by 20% annually in recent years. About 3.3 million air conditioners were sold in India during the 2013-14 fiscal year, adding to the 25 million total units in the country.

Greater adoption of air conditioning has implications for electricity demand and reliability. During the summer of 2012, India's power generation was insufficient to meet electricity demand, leading to residential electricity service being cut off for 16 hours a day in some areas of the country and to a large-scale blackout affecting nearly 600 million people. In 2015, India experienced an intense and sustained heat wave, setting records in many parts of the country. For two weeks at the end of May, average temperatures for the country registered nearly 10 degrees Fahrenheit above historical norms, with heat indexes in Mumbai barely falling below 100 degrees Fahrenheit at night.

To help relieve upward pressure on energy demand because of space cooling needs, India began its first efficiency program for air conditioners through the Bureau of Energy Efficiency (BEE) in 2006. The program involves a standard minimum efficiency level with a competitive labeling program above that level so consumers can compare higher efficiency levels when purchasing air conditioners. BEE also set out a plan to raise the minimum standard and the corresponding competitive labels for units that exceed minimum standards.

An early analysis of the program from Lawrence Berkeley National Laboratory (LBNL) estimated that the standards and labels would save 27 terawatthours (TWh) of electricity use annually by 2020, nearly 14% of projected electricity use for air conditioning in 2020. Without the efficiency program, the study projected a base case consumption of 42 TWh in 2010, 195 TWh in 2020, and 552 TWh in 2030 for air conditioning.

Principal contributor: David Peterson