India’s Booming AC Market: How 14 Million New Air Conditioners Per Year Aren’t Enough to Meet Rising Demand

Aarti Verma is about to join millions of Indians turning to air conditioning to beat the extreme heat, which can soar to nearly 50°C. Last year, India saw record sales of 14 million AC units, and experts predict a huge rise in ownership over the next few decades. For many, such as Aarti, this means safer and more comfortable living conditions.

But this trend also raises concerns about electricity demand. Most of India’s power comes from coal, a major contributor to climate change. As Aarti says, after a long day of work in the heat, “Coming home, I want some comfort.” She plans to spend 50,000 rupees ($584) to install an AC in her small apartment, a significant investment for her monthly earnings of 30,000 rupees ($350).

Air conditioning is no longer just a luxury; it’s seen as essential for well-being. K.J. Jawa, the head of Daikin in India, points out that rising temperatures, a growing middle class, and easier financing options are driving this change. He notes that good sleep is vital for mental and physical health.

In fact, 2024 was recorded as India’s hottest year since 1901. During a May heatwave, temperatures matched the capital’s previous record of 49.2°C. The consequences are dire; nearly 11,000 people died from heat-related issues between 2012 and 2021. Health experts warn these numbers may be underreported.

However, the air conditioning boom also raises environmental concerns. Refrigerants and the energy required for AC units contribute to global warming. Reports show that these units can increase urban temperatures by over a degree Celsius. Despite this, demand remains high. Ahuja from Imperial Refrigeration notes that sales have more than tripled in five years, driven by first-time buyers and the need to replace aging units.

Delhi suffers from severe air pollution, consistently ranking among the world’s worst. Air conditioning is expected to account for a quarter of the nation’s emissions and nearly half of peak electricity demand by 2050. Even so, India has not joined the Global Cooling Pledge aimed at reducing energy-related impacts.

On a brighter note, more people are opting for energy-efficient models. According to Ahuja, energy-saving inverter ACs are becoming the norm, and companies are setting default temperatures at a cooler yet more energy-efficient 24°C. This move is likely to have long-term benefits for both the environment and consumers.

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air conditioners, india, heat waves, climate change