Cooling without power overload

India is facing a summer of extremes. Delhi is sweltering in heat and humidity, with temperatures regularly crossing 40°C even as it grapples with occasional thunderstorms.

- HIMANSHU DIXIT DISHA AGARWAL Respectively programme associate and senior programme lead, Council on Energy, Environment and Water (CEEW)

Keeping the erratic nature of this summer aside, a recent analysis by the Council on Energy, Environment and Water (CEEW) found that 57% of Indian districts, home to over three-fourths of the population, now face high to very high heat risk.

The occurrences of very warm nights are rising faster than hot days, and humidity is up 10% in parts of north India. This mix is driving a rapid surge in the demand for cooling—from air conditioners (ACs) to coolers and fans. This has serious implications for power demand, grid stability, and building climate resilience.

In a move to curb air-conditioning driven electricity consumption, the government wants to increase the minimum set-point limit to 20°C (from 16°C) for residential and commercial establishments. The mandate is targeted to shape consumer behavior to responsibly achieve thermal comfort and avoid over-cooling of spaces while reducing energy bills.

Why is this important? In 2023, India sold ~11 million room ACs—a number that jumped by 30% to a record 14 million units in 2024. These were mostly 3-star labeled models, which consume ~30% more energy annually than 5-star units.

The market is projected to grow at a 20% compound annual rate, with annual sales likely to exceed 30 million units by 2030—significantly exceeding the 15% growth projected by the India Cooling Action Plan. If this trend continues, India's room AC stock will expand nine-fold by 2050.

As an alternative for affordable thermal comfort, the cooler market will also grow at ~15% annually. This surge in cooling devices will substantially increase electricity demand, particularly during peak hours.