Cool way to cut power consumption

New Indian Express

21-06-2025

A 2020 CEEW survey found that nearly 60% of Indian AC users set their units at 23°C or lower. 'Even a modest shift from 18°C to 20°C can cut AC energy use by 12%. If just 30% of new buyers (~5 million) adopt this change, it could save 1.4 billion units of electricity annually — enough to power 10–14 million homes monthly,' Agrawal added.
If India improves its ACs efficiency substantially, energy consumption will be reduced to nearly 120 terawatt-hours by 2035, which is comparable to the energy output of over 60 gigawatts (GW) of solar photovoltaic (PV) capacity, say market estimates. The moot question though is whether the industry and consumers are ready for it.
Different studies show that improving the efficiency of ACs can be a win-win proposition for both the industry and consumers. The IECC study challenges the notion that increasing the efficiency of ACs will make them less affordable. Global data, as well as India's data of AC consumers, reveals that the price of higher efficient ACs consistently decreases while the efficiency of ACs doubles in the same period. Experts explain that the lower cost of ACs with higher efficiency is due to the economy of scale, enhanced manufacturing process, and competitive market dynamics.
Data from Japan shows that between 1990 and 2015, the price of ACs reduced by 80%, while in the same period, ACs efficiency doubled, from 2.5 to 6.1 on the energy efficiency index. In Korea, too, energy efficiency increased to more than double, while the price declined by 60% after inflation was adjusted.
Similarly, between 2004 and 2023, room AC efficiency improved by 60% in India, and prices were nearly halved. However, India's AC efficiency has not increased compared to Japan and Korea, which bolsters the idea that higher efficiency does not lead to increased costs.
Moreover, the price of lesser efficient ACs compared to the efficient ACs is not much different. The IECC analysis shows that the average market price of 5-star ACs (highly efficient) is almost equal to that of 4-star and a little above that of 3-star. The median retail price of 3-star ACs last year was `36,990, whereas the 4-star median price was `43,490, followed by the 5-star price of `43,990.
A market analysis shows that investing in 5-star ACs (1 ton) yields an upfront median incremental price of `5,970 compared to 1-star ACs. However, the higher-efficiency AC consumes 377 kWh less per year, resulting in annual electricity bill savings of `3,360. This implies a payback period of under two years.